VEAM leader prosecuted on charge of mismanagement of state capital

08:00 | 18/01/2020
The leader of Vietnam’s largest engine and machinery producer (VEAM), which holds 30 per cent of Honda Vietnam, 20 per cent of Toyota Vietnam, and 25 per cent of Ford Vietnam, is being prosecuted for mismanagement of state capital.
veam leader prosecuted on charge of mismanagement of state capital
Nguyen Duc Toan, deputy director of Vietnam Engine and Agricultural Machinery Corporation (VEAM), and Tran Thi Thanh Tam, a staff of the company. Source: MoPS

According to the information published on the portal of the Ministry of Public Security (MoPS), on January 16, the Investigation Police Agency under the MoPS prosecuted and detained the two suspects, Nguyen Duc Toan, deputy director of Vietnam Engine and Agricultural Machinery Corporation (VEAM), and Tran Thi Thanh Tam, a staff of the company. Previously, a series of VEAM’s formers leaders were prosecuted.

After the Supreme People's Procuracy of Vietnam approved the prosecution orders, the authorities searched the houses and workplaces of the suspects, seizing documents and objects.

The Investigation Police Agency will expand the investigation and look for embezzled assets. Previously, the agency prosecuted a series of former leaders of VEAM for violating regulations on the management and use of State assets, causing losses and wastefulness, including former chairman of the Board of Directors Tran Ngoc Ha, former general director Lam Chi Quang about the violation.

The prosecution came after the Ministry of Industry and Trade detected serious violations at VEAM, including the management and use of state capital in a number of units that caused losses and even the loss of equity capital. For example, between 2010 and the first six months of 2018, VEAM’s automobile assembly plants reported a loss of VND331 billion ($14.39 million) in equity.

The investigation showed that Tran Ngoc Ha committed violations in buying components and parts,exceeding the company's plans and in assigning staff.

Besides, Ha allowed the director of VEAM's automobile assembly plant to buy 3,000 packages of parts from TCG for the assembly of Hyundai automobiles, which was not included in the manufacturing plan of the company. This incident left VEAM with 5,888 unsold cars in 2017, doubling the figure from 2016. Furthermore, Ha also committed violations in trading and importing 2,010 part packages of Hyundai 71.

Earlier, in August 2019, Bui Quang Chuyen, chairman of VEAM's Board of Directors, reported that in the first six months of 2019, the company failed to reach its revenue target from selling products and providing services.

Formerly known as 1-member State Company Limited, VEAM operates under the Ministry of Industry and Trade under the parent company-subsidiary company model. It was established on May 12, 1990 with the central goal of promoting the industrialisation of Vietnam's mechanical industry and the modernisation of agricultural and rural areas.

By Kim Oanh

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