(Bloomberg) -- The second trial of Vietnamese real estate tycoon Truong My Lan, already facing the death penalty for massive fraud, began Thursday morning, underscoring the new Communist Party chief’s determination to press ahead with a crackdown on corruption.
Lan, clad in a blue shirt and wearing a mask, was escorted into the French colonial courthouse by two police women. The hearing started at 8:15 am after she and 33 co-defendants that include her husband and niece arrived at the Ho Chi Minh City People’s Court in vans accompanied by a phalanx of siren-blaring police vehicles.
The 67-year-old Lan and the others face charges of alleged fraudulent appropriation of property, money laundering, and the illegal transport of currency across international borders in a trial that could last until Oct. 19. She is also charged with allegedly appropriating more than 30 trillion dong ($1.2 billion) from 35,824 investors through bond issuances.
Lan is in good health and has been cooperating with the investigation, according to one of her lawyers. Another of her four attorneys said at the start of the trial that she is calm.
In April, she was sentenced to death for her role in Vietnam’s largest-ever fraud case, after being found guilty of embezzling more than $12 billion from Saigon Commercial Bank between February 2018 and October 2022.
On Thursday morning, police set up a big screen and a hundred plastic chairs outside the 139-year-old courthouse as scores of bondholders jostled to get a good view of the proceedings. Some carried photos of their bonds. Across the street, a few observers wore red T-shirts with slogans demanding the State Bank take responsibility for the scandal.
Before her downfall, the chairwoman of Van Thinh Phat Group gained a reputation for controlling some of the most prestigious properties in the nation’s commercial hub.
The tycoon is one of the highest-profile targets of the government’s years-long anti-corruption crackdown, known as the “blazing furnace” campaign and spearheaded by the late Communist Party Secretary Nguyen Phu Trong. His successor, To Lam, who’s also the country’s president, has said he will “resolutely” continue the aggressive push that has touched all aspects of society and led to the detention of scores of senior officials and business executives.
The fallout continues to have an impact on Vietnam’s real estate sector. It will take two to three years to return to its pre-pandemic growth rate, according to a recent BMI Research note. The industry has been hit by regulatory and legal bottlenecks, liquidity problems and a corporate bond market freeze amid government probes of fraud and real estate companies’ misconduct.
In this second case, police have charged Lan and her co-defendants with the illegal transportation of roughly $4.5 billion across international borders over 10 years beginning in October 2012, news website VnExpress reported in June. She is also accused of laundering around 446 trillion dong ($18.1 billion) in pilfered assets from Saigon Commercial Bank and defrauding bond investors.
Lan is appealing the death by lethal injection verdict handed down earlier this year. Her lawyer has said a date for this hearing is yet to be fixed.
Depending on the outcome of that petition, she still faces decades behind bars after being sentenced to 20 years in prison on each of two other charges at the first trial.
(Updates with start of trial in the second and ensuing paragraphs.)
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