The Ministry of Public Security Tuesday opened a criminal investigation against former director Nguyen Thanh Sang and former deputy director Nguyen Thi Thu Ha for violations related to public property management that led to "losses or wastefulness."
Police searched their houses Tuesday afternoon, but the officials were not taken into custody.
Sang and Ha are suspected of violating regulations in land management, helping disgraced property tycoon Phan Van Anh Vu acquire public land in prime downtown Da Nang locations.
Da Nang is considered the third most important city in Vietnam after Hanoi and HCMC.
By helping Vu acquire properties at prices much lower than the market rates, they caused losses worth millions of dollars to the state budget, police allege.
A day earlier, on Monday, the ministry also opened probes into three businessmen and two other former officials in Da Nang on the same charges, including Nguyen Ngoc Tuan, who served as Da Nang's construction director between 2002 and 2012, before serving as its vice chairman until last year.
Police allege Tuan had colluded with Ha in at least one case during his time as the construction director. They helped Vu buy a piece of land for VND4.4 billion ($190,000), VND1.2 billion ($51,700) less than the initial price approved by the city leaders.
Vu, 44, used to be one of the biggest property developers in Da Nang and was the chairman of three large property companies as also a shareholder in a number of projects in the city.
He also ran businesses in Ho Chi Minh City and manipulated public land prices there as well. Several former officials in HCMC are also being investigated for their roles in Vu's violations.
The biggest casualties in this case so far are former deputy public security ministers Bui Van Thanh, 60, and Tran Viet Tan, 64, who were sent to prison last January for "negligence of responsibility, causing serious consequences."
The court heard that the former officials’ mismanagement had allowed Vu to commit violations involving public land that caused VND1.16 trillion ($50 million) in losses for the state exchequer.
Vu is still awaiting trial in this case, even as he serves an eight-year sentence for deliberately disclosing state secrets and a 17-year sentence for misappropriating more than VND200 billion ($8.6 million) from Dong A Bank.