Police widen probe of alleged graft linked to PetroVietnam

Police widen probe of alleged graft linked to PetroVietnam

Vietnamese police have widened their investigation into alleged graft and
mismanagement connected with the state-owned oil and gas giant PetroVietnam
that caused $69 million in losses.

Three PetroVietnam subsidiaries are being investigated for alleged abuse of
power in appropriating $5.3 million, the Ministry of Public Security said in
a statement late Wednesday.

The case centers on Ocean Bank, which was taken over by State Bank in 2015
at no cost after reporting losses of $445 million. PetroVietnam had owned 20
percent of the bank and lost all its investment after the takeover.

Ocean Bank's former chairman, Ha Van Tham, and general director Nguyen Xuan
Son face embezzlement charges. They are among 51 bankers and businessmen
including 46 senior executives at Ocean Bank who are being tried in Hanoi
for alleged mismanagement.

The bank gave $69 million in interest exceeding the rate set by the central
bank to more than 50,000 individuals and nearly 400 companies and
institutions including three subsidiaries of PetroVietnam, according to the
accusations. Tham and Son are accused of initiating the policy and the other
defendants are accused of implementing it.

The police statement said $3.4 million of the excessive interest was given
to PetroVietnam Exploration and Production Corp., $852,000 was given to Binh
Son Oil Refinery Co. and $1 million was given to VietsovPetro, a joint
venture between PetroVietnam and Russia.

Ocean Bank executives told the court they had to offer customers higher
interest rates to attract savings and that the bank would have collapsed if
they had not done so. They also told the court they had given senior
executives of the three PetroVietnam subsidiaries tens of thousands of
dollars for their support. The senior executives denied the allegations.

Prosecutors on Thursday sought the death penalty for former Ocean Bank
General Ddirector Son, who later served as chairman of PetroVietnam,
according to the state-run Tuoi Tre newspaper.

The newspaper said prosecutors also sought life imprisonment for Tham and
penalties ranging from an 18-month suspended sentence to 27 years in jail
for 49 other defendants.

Over the past two weeks, police have arrested or put under house four other
former or current senior executives of PetroVietnam and a former deputy
State Bank governor who oversaw bad debts at credit institutions.

In May, Vietnam's ruling Communist Party fired Dinh La Thang as the party
boss in the southern commercial hub of Ho Chi Minh City after finding he
made "serious mistakes and violations" while heading PetroVietnam.

Thang had earlier been removed from the Politburo, the highest
decision-making body of the Communist Party of Vietnam. He headed
PetroVietnam from 2005 until 2011, when he was appointed transport minister.
He served until early last year, when he took up the posts in the Politburo
and Ho Chi Minh City.

The party's inspection committee said in April that Thang permitted an
investment in the private Ocean Bank that exceeded regulations, causing
"very serious losses to PetroVietnam."

Thang still retains membership in the Communist Party's Central Committee
and was appointed vice chair of the party's economic commission.

"Currently, the Ministry of Public Security's Investigative Agency is
focusing its forces to investigate, widen the criminal case and seriously
handle those involved in accordance with the law and at the same time will
have measures to retrieve properties to the state," a police statement said.

Vietnam ranks 113 out of 176 countries in Transparency International's 2016
corruption index.

The Communist Party and government have stepped up their anti-corruption
drive in recent years with courts sentencing several senior executives to
death.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Link to Original Article:
http://www.newsobserver.com/news/business/article173234076.html

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com




.