Tycoon Truong My Lan dodges capital punishment, to serve a lifelong prison term instead.
Truong My Lan's Banking Fraud Saga
The chairwoman of Vietnam's property titan, the Van Thinh Phat Group, Truong My Lan, was handed a death sentence last year on counts of embezzlement and bribery. However, the verdict, as her lawyer Giang Hong Thanh affirmingly stated, will be commuted to a life sentence following the National Assembly's decision to abolish capital punishment for certain offenses, such as corruption and attempts to undermine the government. Fast forward, Lan appears to be "very joyous," hinting at her elated feelings about the impending lighter sentence.
In April of last year, Lan, now 68, was found guilty of orchestrating a complex embezzlement scheme involving Saigon Commercial Bank (SCB). According to reports, an array of ghost companies were employed to seize control of the bank, resulting in the alleged plunder of US$12.5 billion from SCB. alarming figures suggested that the total financial impact could reach US$27 billion, although prosecutors admitted that the exact figure remains uncertain.
In a surprising turn of events, May saw an appeal court ruling that would spare Lan the death penalty if she restored three-quarters of the stolen funds.
Since then, there have been significant developments in the recovery and repayment plans. Lan was ordered to repay over $1.2 billion to bondholders and $27.3 billion to SCB. International players, including financial powerhouses like Rothschild, UBS, and Alvarez & Marsal, have been actively involved in a comprehensive restructuring and recovery strategy worth around US$10-12 billion.
In June 2025, Lan proposed a innovative $3 billion recovery plan from her prison confinement, backed by foreign investors. The strategy entails mobilizing investments, recovering secured assets, and expediting repayment to affected investors to save SCB from incurring excessive losses and reduce Lan's sentence by repaying a significant portion of the stolen funds.
The fraud caused a dramatic liquidity crisis at SCB, prompting a run on deposits that drained about 29% of balances (approximately ₫200 trillion) in just five days. This, in turn, required immediate intervention from the central bank. The fallout also resulted in the seizure of SCB by the State Bank of Vietnam, followed by emergency restructuring efforts. The notorious crime led to stricter regulations on corporate bond sales, capping issuance limits and mandating credit ratings to minimize the risk of future abuses. Unquestionably, the case inflicted deep wounds on SCB's reputation and financial stability, instilling broader concerns about systemic risks in Vietnam's banking and credit markets.
- The decision to commute Truong My Lan's death sentence to life imprisonment after the National Assembly's decision to abolish capital punishment for corruption offenses could be considered a significant development in the intersection of politics, business, and finance, given her involvement in the infamous Saigon Commercial Bank (SCB) embezzlement case, a scandal that also intertwined with general news and crime-and-justice sectors.
- As Lan proposed a $3 billion recovery plan from prison in June 2025, involving foreign investors, it marked a unique instance where finance, business, and broader economic recovery strategies were being discussed in the context of a crime-and-justice scenario, highlighting the interconnectedness of these sectors in the aftermath of the SCB fraud scandal, which had far-reaching implications for the entire business and financial landscape of Vietnam.
