A branch of the Saigon Commercial Joint Stock Bank in HCM City’s District 3. Experts demand SCB be held accountable for the bond fraud, given a majority of the victims were the bank’s depositors. — VNS Photo Bồ Xuân Hiệp

Authorities have uncovered a scheme involving Vạn Thịnh Phát, Tân Việt Securities, and SCB, orchestrated by Trương Mỹ Lan, who was chairwoman of Vạn Thịnh Phát and also owner of SCB, to secure loans and issue fake bonds to deceive investors.

Lan’s 1,000-odd fake companies under Vạn Thịnh Phát group carried out fraudulent bond issuances worth over VNĐ30 trillion ($1.24 billion) and sold them to over 35,000 victims, mostly SCB depositors, according to the police.

The victims are calling on authorities to expedite the investigation as they face financial ruin.

The victims claimed they were misled by SCB staff, who reassured them the bonds were safe, given Trương Mỹ Lan’s position as chairwoman of Vạn Thịnh Phát and owner of the bank.

But SCB has refused to take any responsibility, claiming it was only acting as an intermediary and did not guarantee repayment to investors.

Experts said the bank could be held responsible for “failing to disclose the risks associated with the bonds.”

The police also stated that SCB is facing accusations of playing a major role in the massive financial fraud suffered by its customers.

The police have seized substantial assets linked to the scam with a total value exceeding billions of dollars, including stakes in various companies and real estate properties connected to the defendants.

Victims are being assured of their priority in receiving repayment from the recovered funds, and authorities are continuing efforts to seize assets related to the scandal.

The police said they would continue to seize more assets linked to the scandal to compensate the victims.

Authorities continue urging all victims who hold bonds from the fraudulent issuances to come forward with information and related documents.

According to an investigation by the police, Trương Mỹ Lan orchestrated the scheme with former executives of SCB, Tân Việt Securities and Vạn Thịnh Phát to issue fake bonds.

Võ Tấn Hoàng Văn, former CEO of SCB, was found to have conducted ‘training sessions’ for over 2,500 sales staff at various branches nationwide on how to defraud customers, the police said.

Lan has admitted to her wrongdoing and pledged to repay the victims, according to the police.

At her trial in April, Lan received the death penalty for financial frauds at SCB and was also ordered to pay compensation of VNĐ673.8 trillion ($27 billion) to the bank.

Lan and others involved are also accused of engaging in illegal activities, including transporting and laundering billions of dollars across borders over the past decade.

The fraudulent activities have led to market instability and loss of confidence, resulting in a halt in bond issuances.

Lan’s arrest was part of a national anti-corruption campaign which has intensified since 2021.

In 1992, Lan and her family founded Vạn Thịnh Phát, one of the country’s most prominent real estate companies.

While Lan’s arrest has exposed the massive scale of the fraud, experts have warned the scandal is just the “tip of the iceberg” in the financial sector. 

Experts have warned it may take years to address all the consequences of one of Southeast Asia’s most severe financial crimes.— VNS