Truong My Lan faces charges of embezzlement from one of the biggest banks in Vietnam for a span of eleven years.

Vietnam sentences real estate mogul Truong My Lan  to death in the country's biggest-ever fraud trial.

Truong My Lan faces charges of embezzlement from one of the biggest banks in Vietnam for a span of eleven years.

In the biggest financial fraud case in Vietnamese history, a court in Ho Chi Minh City, in the country's south, condemned real estate mogul Truong My Lan to death on Thursday.

Nearly 3% of the nation's 2022 GDP, or $12.5 billion, has been legally accused of fraud against the 67-year-old chair of the real estate company Van Thinh Phat.

Between 2012 and 2022, Lan illegally controlled Saigon Joint Stock Commercial Bank, allowing 2,500 loans that caused the bank to lose $27 billion.

The usually reclusive communist officials were remarkably transparent about this case, providing the media with every little detail. They added that some 200 attorneys and ten state prosecutors were among the 2,700 witnesses called to testify.

Six tonnes of evidence were contained in 104 crates. Truong My Lan, who can appeal, was tried with 85 other defendants despite her denial of the charges.

The defendants were all determined to be guilty. Four were given life sentences. The remainder received sentences ranging from three years suspended to twenty years in prison. The husband and niece of Truong My Lan were sentenced to nine and seventeen years in prison, respectively.

"I believe this is the first show trial of its kind in the communist era," states David Brown, a former US State Department employee with extensive knowledge of Vietnam. "There has certainly been nothing on this scale."

The trial was the most dramatic phase of the Communist Party Secretary-General Nguyen Phu Trong's "Blazing Furnaces" anti-corruption campaign to date.

Nguyen Phu Trong, a conservative ideologue trained in Marxist theory, feels that the Communist Party's hold on power is under grave danger due to public outrage over unbridled corruption. After outwitting the pro-business prime minister at the time to keep his position as the party's leader, he launched the campaign in earnest in 2016.

Hundreds of officials have been reprimanded or imprisoned during the campaign, forcing the resignation of two presidents and two deputy prime ministers. One of the wealthiest ladies in the nation has just joined their ranks.

Truong My Lan was raised in Ho Chi Minh City, formerly known as Saigon, by a Sino-Vietnamese family. With a sizable ethnic Chinese population, it has long been the commercial backbone of the Vietnamese economy, going all the way back to when South Vietnam was still fighting communism and its capital.

She began her career selling cosmetics at market stalls alongside her mother, but once the Communist Party ushered in a phase of economic reform known as Doi Moi in 1986, she started investing in real estate. She possessed a sizable portfolio of lodging facilities and eateries by the 1990s.

The majority of affluent Vietnamese built their fortunes building and speculating in real estate, despite the fact that Vietnam is best recognised outside of the nation for its rapidly expanding manufacturing sector, which serves as an alternate supply chain to China.

In official terms, the state owns all land. Having personal connections with governmental authorities is frequently necessary to obtain access to it. As the economy expanded, corruption increased and spread like wildfire.

As a well-known businesswoman in Ho Chi Minh City by 2011, Truong My Lan was able to organise the combination of three smaller, financially struggling banks to become Saigon Commercial Bank, a larger organisation.

Vietnamese law prohibits any individual from holding more than 5% of the shares in any bank. But prosecutors say that through hundreds of shell companies and people acting as her proxies, Truong My Lan actually owned more than 90% of Saigon Commercial.

They accused her of using that power to appoint her own people as managers, and then ordering them to approve hundreds of loans to the network of shell companies she controlled.

The amounts taken out are staggering. Her loans made up 93% of all the bank's lending.

Prosecutors claim that she gave her driver instructions to take out 108 trillion Vietnamese dong, or more than $4 billion (£2.3 billion), in cash from the bank over the course of three years starting in February 2019 and stash it in her basement.

Even if all of that money was in the highest denomination bills available in Vietnam, it would still weigh two tonnes.

Moreover, she was charged with paying lavish bribes to guarantee that her loans were never investigated. A $5 million bribe was accepted by the former chief inspector of the national bank, who received a life sentence.

Public outrage over corruption towards Truong My Lan, whose worn-out, unstaged court appearance contrasted sharply with the glitzy publicity images people had seen of her, was directed by the abundance of government approved media coverage around the case.

However, there are also concerns regarding her ability to continue the purported fraud for an extended period of time.

Le Hong Hiep, who oversees the Vietnam Studies Programme at the ISEAS - Yusof Ishak Institute in Singapore, adds, "I am perplexed.

"because it wasn't kept a secret. The market was fully aware that Truong My Lan and her Van Thinh Phat group were funding their mass real estate acquisitions in the most desirable locales by using SCB as their personal piggybank.

"It was clear that she needed to find a source for the funds. However, it is such a standard procedure. This is not the only way that SCB is used. Perhaps as a result of the abundance of comparable incidents in the market, the government lost focus."

David Brown thinks she was shielded by influential people who have controlled politics and business in Ho Chi Minh City for many years. Furthermore, he believes that the trial's administration is motivated by a larger goal: regaining the Communist Party's hold over the erratic commercial culture of the South.

"The goal of Nguyen Phu Trong and his party allies is to seize back Saigon or, at the very least, prevent it from eroding.

"Until 2016, the Hanoi party essentially allowed the Sino-Vietnamese mafia to rule the country. While they were milking the city, they would make all the appropriate noises that local communist leaders are supposed to make.

Party chief Nguyen Phu Trong is 79 years old and in poor health. It is quite likely that he will have to step down at the next Communist Party Congress in 2026, when new leaders will be chosen.

Restoring the power of the party's conservative wing to a level not seen since the 1980s reforms, he has been one of the most influential and longest-serving secretary-generals. Clearly, he doesn't want to take a chance by allowing enough transparency to jeopardise the party's political dominance.

He is, nevertheless, caught in a paradox. The party, under his direction, has set a lofty target to become a wealthy nation by 2045, with an economy centred on education and technology. This is the main factor behind the United States and Canada's growing tighter relationship.

However, further growth in Vietnam is nearly a given when it comes to corruption. If you combat corruption too vigorously, you run the risk of greatly diminishing economic growth. Officials are reluctant to make decisions that could put them at the centre of a corruption investigation, which has already resulted in complaints that bureaucracy is slowing things.

The contradiction, according to Le Hong Hiep, is that. Their growth model has historically relied on unethical behaviour. Corruption has served as the essential oil to keep the machinery running. Things might stop working if they stop adding grease."