Former senior HCMC Party official arrested for property mismanagement

The arrest was made Wednesday afternoon by HCMC police. Cang, 49, has been accused of ordering a city-owned company to divest from a real estate firm without permission from the municipal People’s Committee, resulting in a loss of at least VND153 billion ($6.59 million) to the city budget.

Before Cang, authorities had arrested or placed under investigation at least 18 people involved with the divestment transaction.

Inspectors found in 2018 that the Tan Thuan Industrial Promotion Company Ltd (IPC), a wholly-owned investment firm of the city, had complied with Cang’s order to sell its stake in another company to private firm Nguyen Kim without permission from the HCMC People’s Committee.

In June 2017, the IPC had reduced its ownership in real estate developer South Saigon Development Jsc (Sadeco) from 44 percent to 28.8 percent by selling nine million shares to electronics retailer Nguyen Kim.

The selling price was nearly 30 percent lower than what another shareholder in Sadeco had got from Nguyen Kim in September 2016, resulting in a loss of at least VND153 billion to the city coffers.

The divestment was conducted at a time when Sadeco was recording high profits as real estate prices in HCMC were surging, inspectors said.

The divestment resulted in Nguyen Kim becoming the controlling shareholder of Sadeco with a 54 percent stake. In 2015, IPC was the controlling shareholder with a 75 percent stake.

Cang had earlier been accused of other violations involving state assets. The Central Inspection Committee concluded in 2018 that Cang, while serving as director of the city's Department of Transport, had violated land and construction investment regulations by signing a build-transfer contract with Dai Quang Minh Construction Investment JSC in 2013 for building four major roads running a total of nearly 12 kilometers (7.5 miles) in the Thu Thiem New Urban Area.

He had approved the VND12.2 trillion ($524 million) work and in exchange allotted 79 hectares of land to the company to develop commercial and residential projects. But he had no power to approve investments of that scale, with regulations at the time limiting municipal administrations’ powers to VND1.5 trillion.

Cang was also found to have committed serious violations in a deal that saw a land parcel in Nha Be District belonging to the city Party unit being sold at well below market price to a private firm, resulting in a loss of over VND150 billion.

For this, he was dismissed in December 2018 from his positions as deputy Party secretary and member of the Party Central Committee as well as the city Party unit's standing committee for the 2015-2020 period.