Unveiling the Scheme: How Over 15,000 Taels of Smuggled Gold from China, Valued at Over 1.2 Trillion VND, Was “Transformed”

Vietnam’s Ministry of Public Security has concluded an investigation, proposing the prosecution of Tran Thi Hoan, owner of Hoan Hue Jewelry Store in Lao Cai, along with seven others for smuggling. The investigation revealed that within just over two months, Hoan smuggled 564 kg of gold, equivalent to over 15,000 gold bars, from China into Vietnam for profit. The total value of the gold exceeds 1.2 trillion VND.

Erasing Traces: Transforming Foreign Gold into “Domestic Gold”

In September 2024, a Chinese woman, nicknamed “Mrs. Fat,” appeared at Hoan Hue Jewelry Store in Lao Cai. She sold gold and asked for the owner’s phone number “to inquire about prices when needed.” Shortly after, “Mrs. Fat” proactively contacted Hoan, offering raw gold with a purity of 99.99% at a price lower than the market rate.

Recognizing the significant price difference between domestic and international gold, Hoan seized the opportunity. The two parties negotiated via WeChat, agreeing on quantity, price, and delivery methods.

To execute the scheme, “Mrs. Fat” hired Vietnamese individuals working in Yunnan Province to transport the gold into Vietnam. Aware of the security procedures at the Lao Cai border gate—where authorities do not inspect individuals, require shoe removal, or scan luggage—”Mrs. Fat” devised a plan to hide gold bars in shoes, one kilogram per shoe.

The couriers chose a security gate without a body scanner, passing through effortlessly. For each successful trip, they were paid 250,000 VND per kilogram of gold. Upon entering Vietnam, the gold was removed, placed in bags or left in the shoes, and then taken directly to Hoan Hue Jewelry Store via the back entrance.

At the store, Hoan’s employees inspected, weighed, and photographed each gold bar, sending the details to Hoan via Zalo. If any foreign markings or symbols were found on the surface, Hoan instructed the use of a blowtorch to melt and erase all traces of origin.

Payment to “Mrs. Fat’s” associates was made in cash or through bank transfers using accounts registered under employees’ or trusted customers’ names. From September 17 to November 27, 2024, Hoan received 97.3 kg of gold worth 208 billion VND from “Mrs. Fat.”

Expanding the Smuggling Network: New “Distributors” and Hundreds of Kilograms of Gold

Not content with dealing solely with “Mrs. Fat,” Tran Thi Hoan connected with a second “distributor,” Pham Tuan Hai, former Director of Thang Long Trading and Service Company, to expand the supply of smuggled gold from China.

According to the investigation, Hai purchased gold from a Chinese individual named Chau and organized a network to illegally transport it across the border to sell to Hoan. Within three months, from September 2 to December 2, 2024, Hai smuggled 424 kg of gold worth 943 billion VND. Combined with the gold purchased from “Mrs. Fat,” the total amount of gold Hoan is accused of smuggling reaches 564 kg, equivalent to 15,040 gold bars, valued at over 1.208 trillion VND.

Despite the sophisticated and organized nature of the smuggling operation, Hoan’s group could not conceal their tracks. Investigators determined that customs and border guard officers at the Lao Cai border gate were not bribed or complicit. However, the perpetrators exploited loopholes in the inspection process, as the scanning area only applied to luggage and lacked body scanning equipment, allowing the smuggled gold to pass through undetected.

The seemingly simple method of “hiding gold in shoes” enabled the network to transport hundreds of kilograms of gold into Vietnam over an extended period. When arrested, Hoan claimed to have profited only about 100 million VND, even incurring losses when domestic gold prices dropped. In contrast, Pham Tuan Hai admitted to earning 449 million VND, approximately 1 million VND per kilogram of gold. Both were identified as masterminds, with the other defendants acting as accomplices.

Currently, investigators have yet to identify “Mrs. Fat” and Chau, the Chinese suppliers of the gold. Verification at the Lao Cai Customs Department revealed that customs officers at the Lao Cai International Border Gate only manage state regulations for imported and exported goods and vehicles. Individuals crossing the border must declare their luggage or goods exchanged by border residents as required.

Those without luggage or goods are exempt from customs procedures. Only when there is evidence of smuggling or illegal transportation of goods across the border do customs officers conduct personal searches. Additionally, the customs area for inspecting luggage and goods of individuals crossing the border is not equipped with body scanning devices, only luggage scanners.

Gold couriers did not negotiate or offer bribes to customs or border guard officers. Therefore, the police concluded that there was no evidence of misconduct or corruption among customs and border guard leaders and officers.