Stock watchdog tells investors to 'stay calm' after FLC chairman arrest

"The State Securities Commission of Vietnam advises investors to stay calm and analyze all macro factors and actual operation of businesses to make prudent investment decisions," it stated late Tuesday.

The statement was released after the Ministry of Public Security arrested FLC chairman Trinh Van Quyet for using 20 different trading accounts to create fake demand for company shares.

He had attained VND530 billion ($23.19 million) illegally from the trade, which was conducted from Dec. 1 to Jan. 10, investigators said.

Ticker FLC hit a six-week low of VND11,800 Wednesday in its third losing session in a row after rumors of the chairman’s arrest surfaced Monday.

FLC on Ho Chi Minh Stock Exchange (HoSE). Photo courtesy of TradingView

It has dropped 47 percent since the previous peak on Jan. 7.

Before the arrest, Quyet was fined VND1.5 billion on Jan. 18 and prohibited from trading for five months for his misconduct.

FLC has interests in real estate, stock, tourism, and aviation. Quyet owns a 30.34 percent stake in it.

Quyet, 47, has a large stock portfolio and was once one of the wealthiest people on the Vietnamese stock exchange.

He began his career as a lawyer in 2001, when he and his associates established the SMiC Law Office, which later became the SMiC Law Firm. He also established a number of businesses and the FLC brand was formed in early 2010 after merging all of them.

Bamboo Airways, founded by FLC, entered the aviation market in 2019. FLC's charter capital stood at VND10.5 trillion (over $459 million) in early 2021, after more than 10 years of operation.