Not long after Wall Street brought down the global economy five years ago, Vietnam experienced a series of corporate scandals that — like the American banking crisis — has stalled its economy ever since. This week two top business executives learned that the consequences of corporate malfeasance are different in Vietnam than in America. They were sentenced to death.
A Vietnamese court imposed the ultimate penalty on two senior executives of the state-owned shipping company Vinalines. The men had been accused of embezzlement, and Vietnam’s authorities decided to send a message to its own business executives — and to wary foreign investors — that they take corruption seriously.
Last year Vinalines nearly collapsed under $3 billion of debt in one of several high profile scandals at large state-run companies. Its former chairman Duong Chi Dung and CEO Mai Van Phuc were given the death penalty for embezzling $1.5 million. Eight other former executives of Vinalines and other state-owned companies were sentenced to between four and 22 years in prison.
Last month a former banker and his business associate at a large state bank were sentenced to death for embezzling $25 million. Last year nine former executives at the state shipbuilder Vinashin were given lengthy jail terms after the company nearly collapsed in 2010 under billions of dollars of debt.
If the penalties seem harsh, they are explained by more than resentment of ordinary Vietnamese people who blame corruption and mismanagement for the country’s sluggish economy.
Another consideration is foreign governments and corporations that have been looking for signs that Vietnam’s government can be trusted to protect their investments. That’s not a significant concern in the US, which helps explain why nobody on Wall Street has gone to the gallows.