6,600 people lost $354M to real estate developer Tan Hoang Minh's bond scam: police

By Pham Du   October 1, 2023 | 05:01 am PT
6,600 people lost $354M to real estate developer Tan Hoang Minh's bond scam: police
Do Anh Dung, arrested chairman of real estate developer Tan Hoang Minh. Photo courtesy of Tan Hoang Minh
Do Anh Dung, chairman of real estate developer Tan Hoang Minh, was accused of issuing nine bond packages through subsidiary firms to steal over VND8.6 trillion (US$353.84 million) from 6,600 investors.

Dung, along with his son Do Hoang Viet, vice director of Tan Hoang Minh, and 13 others on Friday were recommended by the investigative police department under the Ministry of Public Security to be charged with obtaining property by fraud.

Tan Hoang Minh, with an authorized capital of VND10 trillion, was established by Dung in 1993. To operate as a corporation, Dung either established or bought the stakes of 45 companies, then got people to act as their legal representatives.

The company plunged into financial troubles in 2021 and, by January 2022, it owed the bank around VND20 trillion, not including the eight bond packages that the company had issued since 2021.

Dung then instructed his son Do Hoang Viet to find ways to mobilize capital for the corporation, and the chosen method was the issuance of separate business bonds.

Instead of using Tan Hoang Minh's legal status to issue bonds, the company's subsidiary firms were used instead. Authorities accused Tan Hoang Minh of aiming to mobilize and steal money from investors, including civilians. The point was to evade the law, which states that separate business bonds can only be sold to professional investors.

Dung instructed his subordinates to use the three companies Ngoi Sao Viet, Soleil and Cung Dien Mua Dong to fabricate non-existent economic activities. Through this method, the three companies had issued nine separate bond packages, totaling just over VND10 trillion in value.

In the end, Tan Hoang Minh managed to mobilize around VND14 trillion from people who bought the bonds.

In April 2022, Tan Hoang Minh used over VND5 trillion brought in by people who purchased bonds later to pay those who bought the bonds earlier. The rest of the money, VND8.6 trillion taken from 6,630 people, was stolen by Tan Hoang Minh, authorities said.

Dung said the money gained from the bond issuance was spent on paying off debts at the banks, purchasing stakes, investments, charity and for personal use, among other purposes.

Police said Dung, arrested in April last year, had submitted all the money he scammed from the investors during the investigation process.

go to top