Signs of Criminal Activity, Risk of Over 1 Trillion VND in Losses at Quang Son Cement Plant

The Government Inspectorate has recently unveiled the findings of a comprehensive audit on the Quang Son Cement Plant project, once hailed as a catalyst for industrialization in the mountainous region of Thai Nguyen. However, the project has now been marred by significant financial losses and a slew of legal violations.

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Notably, the Government Inspectorate has recommended that the Prime Minister assign the Ministry of Public Security to take over the entire case file for investigation and verification of incidents with criminal indications, potentially causing a budget loss of over 1.063 trillion VND.

According to the findings, the Quang Son Cement Plant project was constructed in the mountainous districts of Dong Hy and Vo Nhai (formerly), where infrastructure remains underdeveloped. The project’s operation has created jobs, contributed to the local budget, and supported regional development. However, as of December 31, 2021, the plant’s cumulative production and business losses exceeded 1.9 trillion VND.

Quang Son Cement Plant. Photo: Quang Son Cement.

The Government Inspectorate clarified that VINAINCON, the project’s investor, unilaterally adjusted the total investment beyond its authority and requested settlements exceeding the approved investment by 1.063 trillion VND, as well as 763.104 billion VND beyond the Prime Minister-approved bidding plan. These actions severely violate the Law on Bidding, the Law on Construction, and disregard the Prime Minister’s directives.

Sufficient Evidence of Criminal Indications

The inspection conclusion states that the case file contains sufficient evidence of criminal indications, including: Violations of bidding regulations causing serious consequences; Violations of construction investment regulations causing serious consequences; and Negligence resulting in serious consequences.

These indications are evident in several critical bidding packages. For Package No. 1, the bidding plan was approved without proper authority; the bid price exceeded the plan by nearly 17.6 million USD (over 322 billion VND); and some supply quantities were reduced without a corresponding contract price reduction, potentially leading to a loss of 79 billion VND.

For Packages No. 2 and No. 3, VINAINCON and Quang Son Cement Company did not procure mining equipment as approved but instead outsourced it. In 2008, no bidding was conducted to select a mining contractor. In 2023, after rebidding, costs were reduced by 47.5 billion VND, indicating potential prior losses. For Packages No. 14 and No. 19, unauthorized investment adjustments were made, risking a loss of 213 billion VND. Package No. 32A involved improper direct procurement, risking nearly 19 billion VND in losses.

Additionally, VINAINCON’s unauthorized investment adjustments further risked losses of nearly 364 billion VND.

The Government Inspectorate also uncovered over 46 billion VND in illicit profits from resource exploitation during the project.

Based on the collected evidence, the Government Inspectorate confirms the case’s criminal indications and recommends investigation under the law.

The Inspector General has advised the Prime Minister to direct the Ministry of Public Security to take over the case file and evidence, investigate responsible organizations and individuals, and enforce strict legal penalties.

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