Former VSS heads imprisoned for economic mismanagement

Le Bach Hong, former Deputy Minister of Labour, Invalids and Social Affairs and former General Director of Vietnam Social Security (VSS), was sentenced to six years in prison by the Hanoi People’s Court on September 25.

Hong was charged for “intentionally violating State regulations on economic management, leading to serious consequences”, which caused a loss of over 434 billion VND (18.65 million USD) to the VSS.

Nguyen Huy Ban, former General Director of the VSS, and Nguyen Phuoc Tuong, former head of the Planning - Finance Department (now the Planning – Investment Department) and former chief accountant of the VSS, were handed 14 years in prison each on similar charges.

Hoang Ha and Tran Tien Vy, who are former heads of the general planning division under the Planning - Finance Department, will serve seven and three years in prison, respectively.

Tran Thanh Thuy, a former specialist and then deputy head of the general planning division under the Planning - Finance Department, was sentenced to two years in prison for "lack of responsibility, causing serious consequences", but she was handed a suspended sentence.

The six defendants caused losses of almost 1.7 trillion VND (73 million USD) to the VSS.

They have been ordered to pay 835 billion VND (36 million USD) to the VSS, including 150 billion VND from Hong, 292 billion VND from Ban, 292 billion VND from Tuong, 60 billion VND from Ha and 40 billion VND from Vy.

According to the judgment, Hong, as VSS general director, signed and directed the execution of three loan contracts for Agribank Financial Leasing Company No 2 (ALC II), which it is now unable to recover, causing State economic losses of more than 434 billion VND (18.65 million USD).

Agribank was asked to pay compensation of more than 862 billion VND (37 million USD) for the VSS. 

Meanwhile, Ban is accused of signing and directing the execution of 11 other loan contracts worth 630 billion VND (27 million USD) for ALC II, which was not in line with the investment principles of the VSS fund, causing State economic losses of over 1.26 trillion VND (54.3 million USD).

The other four defendants followed orders from Hong and Ban to sign contracts with ALC II, which violated the Social Security Law.

The state securities fund is made up of Government assistance and contributions from employers, employees, the self-employed and people with insurance to be used for the payment of social security benefits as stipulated in the law.

The law stipulates the VSS is not a finance or credit organisation and is therefore not authorized to offer loans.