Another Vietnamese banker named for violations linked to massive banking fraud case

By Hoai Thu   June 2, 2018 | 05:39 pm PT
Another Vietnamese banker named for violations linked to massive banking fraud case
Tran Bac Ha, former board chairman of BIDV, is seen in a file photo by VnExpress.
The former chairman of BIDV allegedly violated Party regulations when he let Pham Cong Danh borrow $206 million from his bank.

The top watchdog of Vietnam's Communist Party has found a former banking official responsible for "very serious" violations committed at the state-owned bank BIDV that are linked to a massive fraud case at Vietnam Construction Bank (VNCB).

In its report, the Central Inspection Committee concluded that Tran Bac Ha, former chairman of BIDV, had violated the democratic centralism principle and working regulations, lacked democracy in his management of the bank and violated the duties and responsibilities of his position.

Ha also violated credit procedures and regulations in approving a number of loans, investments and debt management decisions. In particular, he enabled 12 companies owned by Pham Cong Danh, former chairman of VNCB, to borrow VND4.7 trillion ($206 million) from BIDV.

While BIDV eventually managed to retrieve this money, the loans had helped Danh steal over VND9 trillion from VNCB. At a trial in 2016, Danh was sentenced to 30 years in prison, the maximum jail term allowed by Vietnam's Penal Code, for causing this loss.

In addition to singling out Ha, inspectors also found that the standing committee of BIDV's Party unit for the terms 2010-2015 and 2015-2020 had violated the democratic centralism principle, showed lack of responsibility, poor leadership and lack of inspection and supervision.

These violations in turn enabled multiple systematic violations to occur at BIDV, causing very serious consequences and resulting in multiple staff members being criminally prosecuted, negatively affecting the lives of all BIDV employees.

Inspectors also found BIDV's deputy general directors Doan Anh Sang and Tran Luc Lang responsible for the violations of the bank's Party unit and partially responsible for the VND4.7-trillion loan to Pham Cong Danh.

Ha, Sang and Lang's violations have damaged the reputations of the Party and BIDV and therefore merit disciplinary actions, the Central Inspection Committee concluded.

Ha, 62, is a veteran banker who worked at BIDV for 35 years before retiring in September 2016.

During a trial opened in January into violations committed by Danh and Tram Be, a former deputy chairman of Sacombank who also let Danh borrow money from his bank, Ha was summoned as a witness and a person with related interests and obligations. However Ha did not attend the trial, and his lawyer claimed he had been receiving medical treatments for cancer in Singapore.

The trial was eventually postponed due to a lack of evidence or a strong enough argument to press charges against Danh, Be and 44 other bankers standing trial.

Last Thursday, a court in Vietnam sentenced a former banking executive to 30 years in prison and ordered that she pay more than $700 million in damages caused at the VNCB.

Hua Thi Phan, 71, embezzled $278 million from the VNCB, formerly known as Great Trust Commercial Joint Stock Bank, where she had been a senior board advisor.

Vietnam has over recent years arrested and tried several bankers over financial irregularities as it seeks to restructure a banking system still reeling from nonperforming loans, mismanagement and under-regulated lending, according to Reuters.

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