Investigators from the Ministry of Public Security have proposed the Government Inspectorate instruct its units to provide documents related to the comprehensive inspection of projects at No. 8-12 Le Duan Boulevard in Ben Nghe Ward, District 1, where irregularities have allegedly taken place.

A bird’s eye view of the prime land plot now used as a parking lot 

Some individuals, including Nguyen Thanh Tai, 67, who served as the HCMC vice chairman between 2010 and 2015, were arrested for their alleged involvement in the improper leasing and transfer of nearly 5,000 square meters of land in the downtown area to four businesses under the Ministry of Industry and Trade, causing million-dollar losses for the State budget.

The provision of paperwork is aimed at assisting the investigation into a criminal case on the violations of the relevant individuals over the prime land site, according to the Investigative Police Agency under the ministry.

An investigator told Thanh Nien newspaper that the Bureau for Settlement of Complaints, Denunciations and Inspection in the Southern region under the Government Inspectorate has already handed over some relevant documents.

The police agency is carrying out further investigation into the case in an attempt to pinpoint the entire violations of the concerned individuals who will be strictly punished in accordance with prevailing regulations, the source noted.

In December last year, investigators prosecuted Tai and three other individuals for alleged violations of regulations on the management and use of State assets, causing losses and wastage of the prime land.

Three other officials involved are then-secretary of District 2’s Party unit Nguyen Hoai Nam, 54, who had earlier served as the head of the land management division at the HCMC Department of Natural Resources and Environment; Truong Van Ut, 49, then-deputy head of the same division; and Dao Anh Kiet, 62, former director of the department.

Last May, the Government Inspectorate concluded that the main responsibility should lie with Tai, who played a key role in the city government’s decision to lease the prime land lot without going through the due process of bidding.

The land lot was designated in 2007 for development into a five-star hotel and trade center complex. However, city officials had condoned misconduct in the execution of the plan.

The Government watchdog noted that the local authorities should have carried out a bidding process to select a prestigious and experienced investor. Instead, they approved the establishment of a joint stock company in 2010 to execute the project, following requests from the Ministry of Industry and Trade, whose four companies were renting the land lot.

The HCMC Housing Management and Trading Co., Ltd, which was assigned to manage and lease the land lot, held a 50% stake in the new company named Lavenue Investment JSC, while the trade ministry’s companies held the rest.

Two months later, the four State-run companies transferred 80% of their shares in Lavenue to two private firms based in the city – May Flower Investment Co., Ltd, and Kido Investment Co., Ltd.

In June 2011, Lavenue obtained the city government’s permission to develop a high-end hotel at the lot, paying the city nearly VND700 billion (US$30.6 million). However, no construction has taken place for years, and the lot is now used as a parking lot.

The watchdog found that the transaction showed special treatment to the private companies in violation of the laws on bidding and public asset management, as well as regulations on land use, public land prices and public fund management.

The cost to rent the lot on Le Duan Boulevard is more than VND3.5 million (US$150) per square meter per year, in line with the market price. According to the watchdog, land prices there have climbed to more than VND400 million (US$17,200) per square meter, and if the lot had been auctioned, the city could have earned more than VND2 trillion (US$85.8 million), instead of the VND700 billion it received.