Financial Crime World

Title: Red Flags Raised as Billions in Vietnam Fraud Proceeds Surface in Hong Kong

Concerns Mount over Money Laundering and Lack of Action against Financial Crimes

Reports have surfaced suggesting that the proceeds of a US$12 billion fraud case in Vietnam are making their way to Hong Kong, raising concerns about money laundering and the lack of rigorous action from authorities and financial institutions.

Investigation into the Largest Fraud Case in Vietnamese History

Ms. Truong My Lan and her associates are under investigation for this record-breaking fraud. Financial experts fear that the proceeds of their illegal activities are being hidden through international financial networks.

Hong Kong Connections

Truong’s husband, Eric Chu Nap Kee, is a Cantonese Chinese originally from Hong Kong. His family is allegedly owned substantial assets there, potentially bought with ill-gotten gains.

Intriguing Twists to the Story

Recently, news outlets in Hong Kong reported that Dr. Lee George Lam, a former member of the Chief Executive’s Policy Unit Expert Group in Hong Kong, is wanted by Vietnamese authorities on an arrest warrant for his possible involvement in the fraud. He denies any wrongdoing but was previously a board member at Saigon Commercial Bank, which was allegedly controlled by Truong.

Potential Money Laundering and Assets in Hong Kong

With Chu and Truong already convicted of substantial fraud and corruption offenses in Vietnam, any laundered funds that have gone through Hong Kong’s financial systems could be subject to enforcement action.

Known Property Transactions

  • Nexxus Building in Central District, sold for US$819 million in 2023.
  • Hotel project in King’s Road, Tin Hau, sold for around US$14.5 million in 2023.
  • Commercial/residential site on Finney Street, Quarry Bay, sold for around US$55 million in 2023.
  • A house on the Peak, on Hong Kong Island, sold for US$38 million in 2023.

Although these properties have been sold, investigators believe the funds from the sales might still be sitting in Hong Kong bank accounts. This raises questions about the effectiveness of financial crime prevention measures and the responsibility of Hong Kong and other global financial centers in addressing these issues.

Past Precedents and the Importance of Proactive Investigations

Macau-Hong Kong Money Laundering Case

Precedents, such as the 2000 “Macau-Hong Kong Money Laundering Case” involving Yeung Chun Pong, remind us of the importance of taking swift action against money laundering offenses, regardless of jurisdiction. Yeung was charged, convicted, and sentenced to 2.5 years in prison in Hong Kong for his actions to launder the proceeds through the city.

Ongoing Investigation and Potential Connections to Hong Kong

Although details regarding Chu’s remaining investments in Hong Kong are scarce, some reports suggest that his investments involve The Wellington office tower in Sheung Wan and multiple luxury residences in the Peak and Mid-Levels areas, potentially worth more than US$500 million combined. Some of these assets are reportedly held in the names of close family members, adding complexity to the investigation.

The Need for Action against Money Laundering in Hong Kong

Assessing Potential Money Laundering Activities within the Jurisdiction

Given the magnitude of the ongoing fraud case in Vietnam, Hong Kong authorities and banks must thoroughly assess potential money laundering activities within their jurisdiction. Investigators should determine if Eric Chu Nap Kee, his family members, and associates have any remaining funds or assets in Hong Kong and whether these could potentially be proceeds of crime. Financial crime compliance groups in banks and financial institutions should review their records and assess any connections to Chu and Truong.

In collaboration with law enforcement agencies, financial institutions and regulators must take immediate action to combat the laundering of proceeds from the Vietnam fraud case, maintaining Hong Kong’s reputation as a leading international financial center.

Vigilance and Collaboration Among Jurisdictions

As the investigation into Truong My Lan’s case unfolds, it’s essential to note that this isn’t an isolated occurrence. Jurisdictions around the world, including Singapore, need to remain vigilant and closely monitor any potential connections to the fraud and its alleged financial proceeds to maintain trust in their financial systems and prevent further damage.