Fri, Sep 15, 2017 - Page 10 News List

Probe into graft linked to PetroVietnam widened


Vietnamese police have widened their investigation into alleged graft and mismanagement connected to the state-owned oil and gas giant Vietnam Oil and Gas Group (PetroVietnam) that caused US$69 million in losses.

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

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

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

The bank gave US$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 that US$3.4 million of the excessive interest was given to PetroVietnam Exploration and Production Corp, US$852,000 was given to Binh Son Oil Refinery company and US$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 collapse 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 US dollars for their support. The senior executives denied the allegations.

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

In May, Vietnam’s ruling Communist Party fired Dinh La Thang as the party boss in Ho Chi Minh City after finding he made “serious mistakes and violations” while heading PetroVietnam.

Thang, who had earlier been removed from the Politburo, headed PetroVietnam from 2005 to 2011.

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