HÀ NỘI — Phạm Thanh Hải, 52, former director of the International Trading, Investment and Technology Development (IDT) joint stock company, received a life sentence Monday afternoon for defrauding hundreds of investors.

Hải, who is also the owner of the website hoclamgiau.vn, was charged by the People’s Court of Hà Nội for cheating and appropriating property based on article 174 of the 2015 Penal Code.

Under the indictment, Hải had defrauded 508 people to raise VNĐ2.7 trillion (US$118.6 million) in investments, of which he appropriated VNĐ476 billion ($20.9 million) for his personal benefit.

The indictment said Hải set up the company in 2007. In 2008, he started raising investment capital for private purposes. However, all activities that were introduced and advertised to attract investors were carried out under the company’s name.

Hải then organised seminars and established a social networking site, hoclamgiau.vn, the Voice of Việt Nam’s online newspaper reported.

At the seminars, Hải presented himself as a Ph.D holder with extensive business experience in the former Soviet Union. Hải also bragged that his company was implementing projects that offered high-interest rates.

To entice people to invest their money in his company, Hải offered contracts with interest rates of up to 40 to 50 per cent per year, which was much higher than bank rates. He even paid out interest right after investments were made, although his company had yet to engage in any business activity at the time.

He also encouraged people to help him raise more capital by paying commissions, worth about 2 to 10 per cent of the contract’s total value, for a broker with each new contract.

Hải exploited his position as the company’s director and used the company seal in contracts to gain the trust of investors.

Hải used these tricks to defraud investors out of VNĐ2.7 trillion between October 2014 and October 2015.

The court said Hải’s offense was particularly serious because he used tricks to cheat investors and appropriate a large sum of money, causing misery to hundreds of people.

In addition to the life sentence handed down by the court, Hải was ordered to pay compensation to all his victims. —VNS