Updated at 10:45 a.m. EST on 2015-02-09
The Vietnamese government for the first time has said it “has no choice” but to arrest businesspeople for committing “economic crimes,” although it is widely believed in Vietnam that selective law enforcement is motivated by ruling Communist Party politicians who use executives as pawns in their internal squabbles, sources familiar with the situation said.
When asked at a government press briefing on Jan. 30 why many entrepreneurs had been arrested in recent months, a high-ranking official said, “Even though we don’t want that, we have no choice.”
His response came as observers have been questioning the recent arrests of two prominent businesspeople—Chau Thi Thu Nga and Ha Van Tham—for economic crimes.
Last month, Chau Thi Thu Nga, a national lawmaker from Hanoi, was suspended by the National Assembly for alleged housing project fraud and was detained for further investigation, Vietnam News Agency reported.
An initial investigation found that Nga, who is also chairwoman and general director of the Land and Housing Construction and Investment JSC (Housing Group), collected more than 377 billion dong (U.S. $17.7 million) from investors for housing projects before getting approval from the Hanoi People’s Committee and a construction license, the report said.
Vietnam business tycoon Ha Van Tham was arrested on lending fraud charges last October and suspended from his position as chairman of the private Ocean Bank by Vietnam’s central bank.
But the central bank did not provide further details how Tham violated the law, according to a BBC report.
Pham Chi Dung, a freelance journalist and blogger, told RFA that police carry out arrests of entrepreneurs and businesspeople such as Tham and Nga for economic crimes all the time.
“But recently we heard the explanation of a high-ranking official, who said, ‘We have to arrest them because we have no other choice,’” he said. “This is very [unusual] because they did not say or explain anything until now. Why did they not do it before?
“And why did they only explain about the Ha Van Tham and Chau Thi Thu Nga cases and not others? Is it because Ha Van Tham is said to have a close relationship with a high-ranking official, and Chau Thi Thu Nga also has a close relationship with another high-ranking official?”
Spates of arrests
Spates of such arrests usually occur before major political events in the one-party state, where a politician’s position within the Communist party matters greatly, Pham Chi Dung said.
“The arrests of entrepreneurs are not tricks that the party or the government uses against the businessmen,” he said. “No one would ever do that. They only focus on some entrepreneurs who are said to be sponsored by some politicians. It has to do with position arrangement in the Party; otherwise, it would not happen.”
The arrests of the Tham and Nga occurred just before important Communist Party events were to take place, Pham Chi Dung added.
“One side arrests people of the other side to pressure them,” he said. “Afterwards, they will have an arrangement for positions in the internal party. [But] when they can’t make a deal, then things will become a mess, and there will be a public showdown.”
In another case, Nguyen Duc Kien, one of the country’s wealthiest men, was arrested for tax evasion and illegal trading and given a 30-year sentence last June.
But observers following his case indicated that the charges could have resulted from an attempt to weaken the position of Prime Minister Nguyen Tan Dung, with whom Kien was associated, the BBC report said.
Crony capitalism?
A report by the Saigon Economic Times recently quoted an unnamed National Assembly delegate who said that wealthy entrepreneurs represented crony capitalism and suggested they were responsible for their own arrests.
“They know how to take advantage of opportunities, relationships and loopholes in the legal system while the government does not manage them properly,” he said.
But Nguyen Quang A, former director of the Institute of Development and Studies, a nongovernmental policy-oriented research organization in Hanoi, told RFA’s Vietnamese Service that such arrests are politically motivated “because behind those rich entrepreneurs are the big brass who sponsored them.”
“In political conflicts they always use such pawns to warn the other side, just to make those big guys stop doing this or that…,” he said. “I think the main reason behind this is that they want to attack the big guys behind those entrepreneurs.”
Politicians have increasingly been employing the tactic of having businesspeople linked to their rivals arrested to boost their own standings within the Communist Party since 2012, Pham Chi Dung said.
“This is a way for politicians who have the power in Vietnam … to finalize what they need to do,” he said. “[But] it doesn’t benefit the people.”
Reported by Anh Vu for RFA’s Vietnamese Service. Written in English by Roseanne Gerin.