“Former Vinafood CEO Faces Prison Sentence of 5-6 Years”

On May 13, the trial for the first instance hearing of the case involving irregularities in the transfer of the “golden land” plot at 132 Ben Van Don, District 4, Ho Chi Minh City, took place at the Ho Chi Minh City People’s Court. The case involved the Southern Food Corporation (Vinafood II). During the debate session, the representative of the Ho Chi Minh City People’s Procuracy proposed sentences for the defendants.

The Procuracy recommended that the court sentence Truong Thanh Phong, former General Director of Vinafood II, to 5-6 years in prison.

Tran Van Ven, former Chairman of the Board of Directors, faces a proposed sentence of 4-5 years in prison.

The remaining defendants, including Tran Bay (former Head of Planning and Strategy Division), Vu Ba Vinh (former Head of the Inspection Board), Truong Van Hua, and Truong Van Anh (both former members of the Board of Directors), were recommended sentences ranging from 3 to 4 years in prison.

The Procuracy stated that the six defendants, who were former leaders of Vinafood II, were charged with “Violation of regulations on the management and use of state assets, causing waste and loss.”

Specifically, in 2010, after receiving the Land Use Right Certificate for the land lot at 132 Ben Van Don, District 4, Ho Chi Minh City, Vinafood II failed to account for the asset value and did not establish a fixed asset valuation dossier as required by regulations.

The members of the Board of Directors at that time completed the procedures for transferring the land use rights to Vinh Hoi Company by signing a contract to contribute capital in the form of land use rights, legitimizing the transfer of the project.

Notably, Vinafood II unilaterally set the value of the contributed capital at VND 127 billion without any assessment or re-evaluation of the asset. After transferring the land use rights, Vinafood II’s ownership ratio in Vinh Hoi Company remained unchanged at 1.5 million shares. When implementing the policy of divesting capital from non-core business areas, the company hired Bao Viet Securities Company to organize an auction of the shares, retrieving VND 45 billion.

The Procuracy concluded that the defendants failed to implement the project according to the plan approved by the Ministry of Finance and did not establish a fixed asset dossier, keeping the 132 Ben Van Don land lot off the books.

These actions resulted in a loss of more than VND 113 billion for the state (based on the valuation of VND 241 billion as of January 2011, minus the contributed capital value of VND 127 billion set by Vinafood II). After retrieving VND 45 billion from the share auction, the actual total damage caused by the case was determined to be more than VND 68 billion.

Defendant Truong Thanh Phong was identified as the main actor, directing the entire process of violations, from contributing capital to establish Vinh Hoi Company to transferring land use rights contrary to regulations.

Following Phong’s instructions, defendant Tran Van Ven signed Official Letter No. 146, agreeing to establish Vinh Hoi Company to implement the project.

Subsequently, Ven signed Official Letter No. 127, approving the transfer of land use rights to Vinh Hoi Company at a price from 2007, which was not in accordance with the law at the time of implementation.