HÀ NỘI — Former Politburo member and chairman of the State-owned oil group PetroVietnam (PVN) Đinh La Thăng yesterday received an 18-year sentence for his ‘principal role’ in the notorious OceanBank case that caused losses of VNĐ800 billion (US$34.8 million) to the State budget.

The former Minister of Transport and former Party Secretary of the HCM City Party Committee will also be required to repay VNĐ600 billion ($26.34 million), a three quarter of the total losses, per the verdict of the Hà Nội People’s Court, concluding the 10-day trial into the major economic mismanagement case and a highlight in the Việt Nam Communist Party’s anti-corruption drive.

Thăng, along with five other defendants – PVN former deputy director-general Nguyễn Xuân Sơn and four members of PVN’s board of directors – who received sentences ranging from several months on probation to five-year imprisonment, were charged with deliberate violations of the State’s economic regulations, causing serious consequences.

Slapped with the heaviest penalty in the case, Ninh Văn Quỳnh, former chief accountant of PVN, received a total 23 years in prison – seven years for serious economic mismanagement and 16 years for abuse of power to misappropriate assets. Quỳnh was found to have received ‘gifts’ worth several billion đồng ­– including cash and a luxury apartment in Hà Nội – from Sơn (sourced from OceanBank’s illegally gained profits) – for his lobbying efforts that would sway PVN’s actions in OceanBank’s interests.

The other defendants were also asked by the court to pay the rest of the civic compensation for the full amount of the $34.8 million loss.

This is the second time Thăng was put on trial, as he already got 13 years for a separate case of mismanagement at PVN.

Flouting the law

In 2008, after PVN’s initial plan to establish a joint-stock commercial bank was rejected, the oil group switched to investing instead into the private OceanBank.

The entire process, involving three share purchases lasting from 2008 through 2011, was conducted at Đinh La Thăng’s helm and by other defendants, despite their full awareness of OceanBank’s then small scale and limited financial capacity.

Coupled with OceanBank chairman Hà Văn Thắm’s wilful violations of regulations for credit institutions, the bank later suffered serious losses and the owner’s equity dropped to minus value, meaning PVN’s shares were essentially wiped out when the State Bank of Việt Nam had to step in and buy it for zero đồng in 2015 to avoid the bank’s otherwise unavoidable bankruptcy.

During the trial, Thăng and his lawyer several times argued that he did not “intentionally commit wrongdoings,” claiming that the capital contribution was approved by the then Prime Minister Nguyễn Tấn Dũng and Government, and that it was in line with the 2006 decision to establish the oil group, which allowed the corporation to invest outside of the energy sector.

However, the judge panel said that Thăng’s decision was made without going through PVN’s board of directors, or without regards to the finance ministry’s regulations on conditions for capital contribution. His decision was only reported to the then Prime Minister afterwards. 

Since January 11, 2011, the law on credit institutions provided that a shareholder must not hold more than 15 per cent of a credit institution’s shares, however, Thăng  directed his subordinates to buy more shares of the bank resulting in PVN holding 20 per cent of shares at OceanBank.

The defendants’ lawyers also argued that the 34.8 million losses were not ‘real’ since PVN’s investment “yielded productive results, and PVN shareholders received their dividends each year,” and that Thăng and his cohort’s actions did not have any causal relations with the consequences.

The judge panel noted that by the end of 2012, OceanBank was already shouldering losses of VNĐ992 billion and still refused to correct its wrongdoings, according to the State Bank’s inspection. The inspection results also showed that the bank’s annual earnings reports were untruthful, as were the so-called dividends paid to shareholders.

The judge panel said there was enough evidence to establish a causal relationship between the intentional wrongdoings of the defendants and the loss incurred. — VNS