A court in Vietnam has sentenced Trinh Van Quyet, former chairman of real estate developer FLC Group, to 18 years in prison for ‘fraudulent appropriation of property’ and three years for ‘stock market manipulation,’ with total compensation to investors determined at some $94.8 million.

The 49-year-old Vietnamese property tycoon was sentenced to a total of 21 years in prison, according to the judgment announced by the Hanoi People’s Court on Monday, following a 14-day trial for Quyet and 49 other defendants, including seven who faced the same two charges as Quyet.

Among the seven convicts are Quyet’s younger sisters, Trinh Thi Minh Hue and Trinh Thi Thuy Nga, both accountants at FLC Group, who were sentenced to 14 years and eight years in prison, respectively. The remaining five received sentences ranging from four to 11 years in jail.

The 42 other defendants received sentences ranging from 15-month suspensions to seven and a half years in prison for offenses including ‘stock market manipulation,’ ‘fraudulent appropriation of property,’ ‘abuse of power or position while performing official duties,’ and ‘intentional dissemination of false information or concealment of information in securities activities.’

Another defendant, Doan Van Phuong, who is FLC Group's former general director, and former chairman of FLC Faros Construction JSC, has been at large and wanted by the investigation agency, according to the Vietnam News Agency.

According to the indictment, in August 2012, Quyet, as chairman of FLC Group, directed the acquisition of Green Belt Entertainment JSC for VND1.5 billion (US$59,640) and later renamed it FLC Faros Construction JSC. 

From 2014 to 2016, Quyet orchestrated a scheme to falsify capital contribution documents, inflating FLC Faros' capital to VND4.3 trillion ($170.9 million).

This falsified capital led to the approval of FLC Faros’ registration as a public company, which then listed over 430 million shares on the Ho Chi Minh Stock Exchange (HoSE). 

Between September 2016 and March 2022, Quyet ordered his accomplices to sell over 391 million shares on HoSE, misappropriating over VND3.6 trillion ($143 million) from investors.

The trial panel identified more than 25,800 investors as victims who had purchased FLC Faros shares. 

Based on relevant calculations by the investigation agency, the court ordered Quyet and Hue to jointly pay these investors more than VND1.7 trillion ($67.5 million) in compensation.

The court also determined that Quyet engaged in stock market manipulation from May 2017 to January 2022.

He was found directing his sister, Hue, and other accomplices to use the identities of 45 individuals to set up 20 companies and open 500 securities accounts, which Hue used to manipulate the market for five stocks, AMD, HAI, GAB, FLC, and ART, resulting in their illicit gains of VND723 billion ($28.7 million).

Out of the gains, Quyet and his accomplices were ordered to pay back more than VND684 billion ($27.3 million) as compensation for their acts of stock manipulation for only four stocks: HAI, GAB, FLC, and ART, which occurred after the Penal Code 2015 took effect, Phap Luat Thanh Pho Ho Chi Minh (Ho Chi Minh City Law) newspaper cited the trial panel.

Their stock manipulation involving the remaining stock, AMD, which resulted in the remaining unlawful gains of VND39 billion ($1.55 million), is not governed by the Penal Code 2015, as it occurred before the code's effective date, according to the newspaper.

For both offenses, Quyet and his accomplices were determined to pay some $94.8 million ($67.5 million plus $27.3 million) in total compensation.

Of this amount, the defendants had settled VND264 billion (nearly $10.5 million) by July 26 for the offense of ‘fraudulent appropriation of property,' Nhan Dan (People) newspaper reported, citing the trial panel.  

Quyet was the mastermind of both crimes, so he had to be severely punished. However, he also had extenuating circumstances, which had been considered by the court when deciding the sentences for him.

Among such circumstances are his honest confession and active remediation of the consequences, according to the trial panel.

Quyet and FLC Group once developed many large projects in remote areas and economically disadvantaged areas such as Binh Dinh, Ninh Binh, Quang Ninh, and Thanh Hoa Provinces, generating thousands of jobs for many years and contributing to the economic development of these localities, the court noted.

In addition, the court had received many petitions from various localities and people asking for a reduction of his penalties.

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