All central bank inspectors took bribes from SCB: police

By Pham Du   November 21, 2023 | 08:03 pm PT
All central bank inspectors took bribes from SCB: police
Inside an office of SCB. Photo courtesy of SCB
All 24 central bank officials tasked with inspecting SCB received bribes of between VND100 million ($4,137) and $5.2 million to condone the lender’s extreme violations, the police have said.

The Ministry of Public Security recently recommended charging Do Thi Nhan, former head of the State Bank of Vietnam’s inspection and supervision department, with receiving bribes worth $5.2 million from SCB from whom Truong My Lan had siphoned away VND1 quadrillion ($44 billion) worth of public deposits over a decade.

It has recommended charging 16 other officials who inspected the bank with abusing their position and authority while performing official duties.

The remaining seven will not be charged since they collaborated with investigators and returned the money they had taken illegally.

The police said Nhan discovered the scam in August 2017, but, as head investigator, falsified the reports allowing SCB to continue operating normally.

At a meeting with Lan, who unofficially owned a 91.5% stake in the bank, in HCMC in October 2017, Nhan said the violations were severe and the bank needed to sell off its assets to repay depositors.

Lan asked Nhan to "help" SCB, and she instructed her subordinates not to mention VND38 trillion worth of bad debts in the reports, which also falsified all key financial indicators of the bank.

Nhan reduced the bad debt ratio, which was in reality 35.8%, to 6.8%.

At another meeting in Hanoi in March 2018 Nhan told Lan that she had discovered violations committed by 71 SCB customers who were part of her ring.

Lan again asked her for help.

Nhan told her subordinates not to track the source of the 71 customers’ money and scaled down the investigation to overlook the fact that SCB had given out new loans to these customers to repay earlier ones.

Nhan and her boss Nguyen Van Hung, the SBV’s deputy chief inspector, have confessed that they altered the investigation reports to conceal the scam from the central bank and government.

All the inspectors received bribes, of VND100 million to $40,000, from SCB, with Nhan getting $5.2 million.

The ministry recommended last week that Lan should be charged with several crimes, including bribery, violating banking regulations and embezzlement.

Eighty five others were included in the recommendation for the same charges plus appropriation of property by abusing trust.

Lan and her accomplices caused SCB VND500 trillion in losses, the police said.

After the private lender faced a run in October 2022 the central bank put it under special control to also prevent an industry-wide contagion.

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