Two former officials and a businessman were escorted from Ho Chi Minh City to Hanoi over the weekend as investigations continued into their alleged violations in a loan agreement causing hundreds of billions of dong in losses to the state budget.
Vu Quoc Hao, director general of the Agribank Financial Leasing Company No.2 (ALCII), a member of the state-owned Vietnam Bank for Agriculture and Rural Development, granted a loan of hundreds of billions dong to Quang Vinh Construction and Trade Co., Ltd. for the company to invest into assets.
However the company headed by Dang Van Hai, spent the money on other things so it is difficult to get the money back, investigators said.
Hao and Vinh, together with Ton Quang Viet, former head of ALCII's loan department and who submitted the company's application for loan, were all arrested Saturday.
The arrest was made a couple of days after investigators from the State Bank of Vietnam concluded that ALCII had made critical violations in managing and using state capital, including wrongful assessments of customers' creditworthiness, leading to huge losses.
In 2009 the company, established in 1998 as a company lending capital for purchase of equipment and making other technological investment, lost VND3 trillion (US$143.4 million), which was 8.5 times its chartered capital, according to the investigators.
State bank governor Nguyen Van Giau told Thanh Nien Sunday that in fact inspections of ALCII's operations between 2007 and 2009 had reached similar conclusions last year.
About ten days ago they handed over their findings to the police for follow up action, he said.