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Bank tycoon tearful in court

Released at: 20:26, 10/01/2018

Bank tycoon tearful in court

Former Vice Chairman of Sacombank Tram Be (Photo from news.zing.vn)

Third day of major banking trial sees accused banker downplay his role in fraud.

by Duy Anh

The third day of the trial of 46 banking executives and staff accused of violating economic regulations that resulted in $400 million going missing in Ho Chi Minh City saw a former bank tycoon shed tears about giving loans to an acquaintance.

Tram Be, 58, former Vice Chairman of Sacombank, and Pham Cong Danh, 52, former Chairman of the Vietnam Construction Bank (VNCB), had known each other for some time. According to Be, Danh had been a long-time customer during his time at Southern Bank, which merged with Sacombank in 2015. Be was also familiar with Danh’s Thien Thanh Group and Trust Bank, which was rebranded as VNCB by the central bank in 2012.

According to the indictment, Be helped Danh borrow VND1.8 trillion ($79 million), the limit Danh could borrow without Board approval, from Sacombank by using his position to sidestep banking regulations. He processed a loan application from Danh in just a day, taking an illegal deposit from VNCB as a guarantee.

Danh spent VND1.7 trillion ($74.6 million) of the sum repaying debts to another local bank owed by six companies he owned and deposited the remainder in a personal account. As the six companies did not conduct any business activities, Sacombank collected the principal loan of VND1.8 trillion ($79 million) and VND35 billion ($1.55 million) in interest from VNCB’s deposit account at Sacombank.

Be said he only viewed Danh as a customer with collateral assets when deciding to approve the loans, citing the business plans of the borrowing companies and the interest to be earned from the loans.

“I thought there would be no criminal prosecution if I could collect the debt,” Be said, adding that he did not know where the VNCB guarantee to Sacombank came from and was not personally interested in seeing the loans approved.

“I have reviewed the assessment by SBV about my wrongdoings, but I believe a bank can do what the law does not prohibit,” Be said.  

According to Be, he stands where he is today because he declared that he had known Danh before the loan was granted. “Is honesty a crime?” he asked.

According to prosecutors, former BIDV Chairman Tran Bac Ha was also involved in a multi-million-dollar loss incurred by VNCB at BIDV, in which Danh used VNCB deposits as guarantees and repaid debts owned by his 12 companies, causing VND2.55 trillion ($112 million) in losses for VNCB.

Ha signed 12 decisions approving loans for the purchase of building materials for Danh’s companies, even though the decision did not mention what loan guarantees there were, and Ha himself did not directly approve the loans but transferred the responsibility for processing the loans to BIDV branches.

The results of the investigation so far have not been enough to determine links between Ha and Danh, because there are no documents, evidence, or testimony on who knew about the borrowing companies, which were set up and operated by Danh.

The court has received an application for absence from Ha, who was summoned for testimony, due to his treatment for liver cancer. A representative from the Supreme People’s Procuracy in Ho Chi Minh City requested he show up at all costs to clarify the issues in the case.

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