Around 36,000 individuals who invested in bonds issued by SCB were identified as victims of a massive fraud. One such victim, online noodle seller Nguyen Thi Huong, lost her entire life savings of US$20,000 in 2022, leading her to feel like she was “losing her mind.” The devastating financial loss caused Huong to develop insomnia, experience declining health due to stress, and struggle to afford extracurricular classes for her children, resulting in them falling behind their peers. The situation became so dire for Huong that she contemplated taking her own life while sitting by her father’s grave.
The mastermind behind the fraud, Lan, was reported to have stolen approximately US$18 billion by siphoning assets from SCB between early 2018 and October 2022, effectively owning a 90 per cent stake in the bank. As the chair of major real estate developer Van Thinh Phat, Lan directed her associates to withdraw cash from SCB and move it out of the system. She then laundered the money by obscuring its origins and using it to settle debts between companies or transferring it abroad under the guise of fake contracts. This elaborate scheme led to significant financial losses for many unsuspecting victims.
As Lan’s trial commenced, dozens of victims held protests in central Hanoi, demanding government intervention to help them recover their lost funds. Despite expressing remorse in court and claiming she was “not a bad person,” Lan was sentenced to death in April after being found guilty of embezzling US$12.5 billion. While she is appealing the verdict, a date for the hearing has not been set. Prosecutors estimated the total damages caused by Lan’s actions at US$27 billion, approximately six per cent of Vietnam’s gross domestic product in 2023.
The scale of the fraud perpetrated by Lan and her accomplices has had far-reaching consequences, impacting not only the victims financially but also causing emotional distress and mental health issues. Individuals like Nguyen Thi Huong, who lost their life savings, have faced severe hardships as a result of trusting SCB and being deceived by the fraudulent scheme. The case has also raised concerns about the lack of oversight and regulation in the financial sector, leading to calls for stricter measures to prevent such incidents in the future.
The staggering amount of money embezzled by Lan highlights the need for improved safeguards and accountability within the banking and financial industry in Vietnam. The case has drawn attention to the vulnerabilities in the system that allowed such a large-scale fraud to occur, prompting calls for reform and increased transparency to protect investors and prevent similar incidents from happening again. The victims of the SCB fraud continue to seek justice and restitution for their losses, while the authorities grapple with the fallout from one of the largest financial crimes in the country’s history.
