Vietnam recovers $384 mln, offsets TV firm acquisition losses

By Bao Ha, Hoang Thuy   December 2, 2019 | 10:47 am GMT+7
Vietnam recovers $384 mln, offsets TV firm acquisition losses
A MobiFone logo is seen at an office in Vietnam. Photo by VnExpress.

Authorities have recovered nearly VND8.9 trillion ($383.5 million), offsetting losses caused in the illegal acquisition of private pay TV firm AVG.

Speaking to VnExpress on the sidelines of a National Assembly session in Hanoi, Supreme People's Court Chief Justice Nguyen Hoa Binh said the amount of money recovered in this corruption case was a record-high, and the speed with which it was done was also unprecedented.

The case that involved violation of regulations on management and use of public capital that lead to "serious consequences," giving and accepting bribes, will go to trial at the Hanoi People's Court for 16 consecutive days starting December 16.

Fourteen suspects will be brought to trial, including two former ministers of Information and Communications, two former general directors and five former deputy general directors of MobiFone.

The suspects have returned nearly VND8.9 trillion, most of which was the money AVG's former chairman Pham Nhat Vu returned to MobiFone after the acquisition deal fell through. The remaining amount has been handed over by information ministers Nguyen Bac Son, Truong Minh Tuan and MobiFone's former chairman Le Nam Tra.

The VND8.8 trillion ($379.2 million) Vu returned also covers the losses directly caused by the crimes committed by the former ministers and former MobiFone leaders, prosecutors said.

The indictment stated that in 2015, the wholly state-owned telecom company MobiFone, which was managed by the Ministry of Information and Telecommunications, wanted to invest in the pay TV sector. Son, who was serving as information minister at the time, suggested that MobiFone acquire the private pay TV firm Audio Visual Global (AVG) and pushed for the deal to be done within his term to make it his legacy.

After five rounds of negotiations, under Son's directions, AVG and MobiFone reached an agreement for the latter to acquire a 95 percent stake at the former for nearly VND8.9 trillion on October 2, 2015. Son and Tuan, who was his deputy at the time, decided not to release information on the deal and suggested that this information be listed as a state secret.

According to investigators, even though the price and the investment efficiency of this project had yet to be clarified by competent authorities, Son still issued a directive on December 15, 2015, ordering that the project be implemented immediately and completed before the end of the fiscal year 2015.

He subsequently instructed Tuan to sign a decision to approve the project on December 21, 2015 despite the prime minister having yet to approve this investment policy.

These actions resulted in MobiFone acquiring a 95 percent stake at AVG for nearly VND8.9 trillion, which was many times higher than AVG's real value, and brought great benefits to the pay TV firm's then-chairman Vu and its shareholders.

After discovering these violations, investigators have accused Son, Tuan and many MobiFone leaders of directly causing a loss of nearly VND6.6 trillion ($284.4 million) to the state. This loss was calculated by taking the VND8.5 trillion that MobiFone had already paid AVG then subtracting VND1.97 trillion, which was the actual value of AVG's remaining assets, and adding VND115 billion, which was the total value of the interest payments MobiFone had lost due to withdrawing money from term deposits before maturity to pay AVG.

In 2018, Vu voluntarily returned nearly VND8.8 trillion to MobiFone, which include the original payment of VND8.5 trillion as well as the lost interest payments and other expenses.

Prosecutors have determined that Vu is not chiefly responsible for the losses to MobiFone caused by Son and his accomplices, and noted that Vu had proactively offset all these losses.

Regarding the charges of giving and taking bribes, the indictment stated that nearly VND100 billion had been recovered from these crimes.

According to investigators, in order for the acquisition deal to be approved in a way that benefits him, Vu gave bribes of $3 million to Son, $200,000 to Tuan, $2.5 million to Tra and $500,000 to MobiFone's former general director Cao Duy Hai.

Prosecutors however noted that since the launch of the investigation into these crimes, Tra's family has handed over the $2.5 million he had received, while Tuan and Hai have handed over VND4.1 billion and over VND11 billion respectively. Son has also expressed willingness to hand over the bribe he had received but his family has refused to cooperate. Hence police have only been able to recovered nearly VND600 million from him.

Police have also frozen bank accounts and savings books containing nearly VND5 billion that belong to Son, Tuan and Tra, and the other three have agreed to use these assets to offset the consequences of their crimes.

At the upcoming trial, Son, Tuan, Tra and Hai would be tried for "violating regulations on the management and use of public capital that lead to serious consequences" and "taking bribes" Vu will be tried for "giving bribes" and would face 12-20 years in prison.

Prosecutors will ask judges to consider all factors and mitigate eventual punishments based on their behavior after their arrests. They are also set to request that mitigating circumstances be applied to Vu as he was "fully aware and repentant of his crimes" and has actively cooperated with investigators. He has also engaged in many charitable activities and many organizations have sent letters on his behalf, asking for leniency.

The TV firm acquisition is a major case in the corruption crackdown spearheaded by Party General Secretary and President Nguyen Phu Trong. The campaign has seen scores of officials and top businesspeople arrested and sent to jail in recent years.

 
 
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