The People’s Procuracy of Ho Chi Minh City on December 16 commenced legal proceedings against Tat Thanh Cang, former permanent vice secretary of the municipal Party Committee, to investigate for “violations of regulations on management and use of State assets, causing losses”.
Cang was accused of being involved in several violations found at the South Saigon Development JSC (Sadeco).
Inspectors found that in 2017 the Tan Thuan Industrial Promotion Company Ltd (IPC), a wholly-owned investment firm of the city, had complied with Cang’s order to sell its stake in Sadeco to private firm Nguyen Kim without permission from the HCM City People’s Committee.
The IPC had reduced its ownership in Sadeco from 44% to 28.8% by selling nine million shares to electronics retailer Nguyen Kim.
The selling price was nearly 30% lower than what another shareholder in Sadeco had got from Nguyen Kim in September 2016, resulting in a loss of at least VND153 billion (US$6.6 million) to the city budget.
The divestment was conducted at a time when Sadeco was recording high profits as real estate prices in HCM City were surging.
The divestment resulted in Nguyen Kim becoming the controlling shareholder of Sadeco with a 54% stake.
At the 12th Party Central Committee’s ninth session, the committee dismissed Cang from his posts as member of the 12th Party Central Committee, permanent Vice Secretary of HCM City’s Party Committee and member of the committee’s standing board in the 2015-2020 period for his serious violations.
During its 31st session in November 2018, the Inspection Commission of the Party Central Committee concluded that Cang had flouted the principle of democratic centralism, as well as the municipal Party Committee’s authority and working regulations on asset management and use in enterprises owned by the municipal Party Committee.
Cang was found to have contravened stipulations on deciding the business cooperation policy and transferring of project ownership as well as land use rights among the companies. He was also accused of allowing the Party Committee’s capital representative to vote on the issuance of stocks to strategic share-holders at enterprises.
He was charged with lacking responsibility, as well as being lax in management and in his inspection of the fields under his authority, which caused critical losses to the municipal Party Committee’s budget.
In addition, when Cang was holding the post of Director of the municipal Department of Transport, he broke the law to approve the construction of four main roads in the Thu Thiem new urban area.
The Inspection Commission said that Cang’s wrongdoings were serious, triggering social uproars while damaging the municipal Party Committee’s prestige.