Firm ‘misused $508m in State-owned funds'

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VietStock FI English - 26 month(s) ago 4 readings

Government inspectors have discovered a series of violations regarding the improper use and management of State-owned capital and assets at Song Da Holdings.

A recent inspection revealed a total of roughly VND10.67 trillion (US$508 million) went unaccounted, the Tuoi Tre (Youth) Newspaper reported.

Inspectors have petitioned the Prime Minister to direct appropriate measures to deal with the missing money.

According to the Tuoi Tre, the inspectors asked the Prime Minister to require Song Da Holdings to devise measures to handle the combined financial infringement of VND9.97 trillion ($474.7 million) at its holding firm, its member corporations and affiliates.

Song Da group is the conglomerate of six corporations including Song Da Corp, Viet Nam Machine Assembly Corp (Lilama), Construction and Infrastructure Development Corp (Licogi), Construction Investment and Development Joint stock Corp, Song Hong Joint stock Corp, and Construction Mechanics Corp (Coma). In addition, the holding has about 85 affiliates, subsidiaries and funds.

The inspection report indicates that after the merging of these six corporations, the Ministry of Construction did not assess the stake of State-owned capital but gave the group management board this task, thus causing an inaccurate assessment of the group's charter capital.

Under the petition, the Ministry of Industry and Trade will deal with the over VND668 billion (US$31.81 million) for fuel that Lilama illegally received from the Electricity of Viet Nam based on the bidding contract of the expanded Uong Bi power project.

The inspectors also required the group to pay VND8 billion from asset depreciation of the Deo Ngang Tunnel. The Construction Investment and Development Joint stock Corp will also have to pay back VND23 billion of illegal incentives.

Of the total sum, the group and its members were alleged to spend up to VND2.33 trillion investing in non-core businesses. Their core businesses include construction, power, mechanics and cement.

"The capital and asset management has loosened, causing losses in tax payment to the State budget," the newspaper reports.

The group and its members investted a combined capital of VND195 billion ($9. illon) into the Viet Nam Investment Fund. Yet with low effectiveness and high risk, they are on the verge of losing this money.

In addition, Song Da Corp did not build the My Dinh-Me Tri new urban area as approved by the Ha Noi People's Committee. It signed a deal to subcontract Sudico and Bitexco jointly implementing the project without a permit from relevant authorities.

Song Da Corp also did not carry out the Nam An Khanh new urban area project but instead shifted the building to Sudico without consulting the relevant authorities.

The inspectors also petitioned the Prime Minister to assign the Ministry of Public Security to direct an investigation of corruption in the to continue clarifying missing capital and loose asset mismanagement at the Song Da Holdings.

Viet Nam News could not reach the Song Da Holdings for comments yesterday.

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