What seen from exposed multi-billion-dollar financial scams in Vietnam?
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Terms like Mr. Pips, Trieu Nu Cuoi (Million Smiles), GFDI, and investment fraud became some of the hottest keywords trending on social media in Vietnam in 2024 – the year that witnessed an unprecedented surge in exposed investment scams, with figures that could shock anyone.’
A 2024 cybersecurity survey by the National Cybersecurity Association shows that for every 220 smartphone users in Vietnam, one person falls victim to online scams, accounting for 0.45%. The total losses from these scams are estimated at a staggering VND18.9 trillion ($744.6 million).
Of the victims, only a very small percentage are able to recover their money. Up to 88.98% of users said they immediately gave warnings to their friends and families when they fell victim of a scam, but only 45.69% of those surveyed reported the scam to the authorities.
The number VND18.9 trillion is not just a number. It highlights the severity of technology-related investment frauds. People were once shocked by the massive confiscated assets of over VND5.2 trillion ($204.85 million) related to Mr. Pips, a popular “investment guru” on TikTok, Telegram, and other social platforms before his arrest.
On December 20, 2024, the Hanoi police announced that they had coordinated with Interpol to issue an international arrest warrant for Le Khac Ngo (34, in Phu Dien, Bac Tu Liem district). Ngo was an accomplice of Pho Duc Nam, known as TikToker Mr. Pips, in the criminal case of “fraudulent appropriation of property, money laundering, harboring assets obtained from criminal acts, and failing to report crimes.”
Nam, Ngo, and 29 other individuals were formally charged in this case. However, Ngo had fled, and police are calling for his surrender in exchange for leniency.
On the afternoon of December 26, Major General Nguyen Thanh Tung, deputy director of the Hanoi Police Department, confirmed that following the dismantling of the fraud network led by Nam, investigators were making efforts to recover appropriated assets. At that time, authorities seized additional assets including a Mercedes G63 worth VND12 billion ($472,720), 18 luxury apartments, and real estate worth about VND100 billion ($3.94 million).
By December 10, the police had seized assets totaling over VND5.2 trillion, including VND316 billion ($12.46 million) in bank accounts, VND9 billion in bonds, over VND200 billion in savings books, VND69 billion in cash, $2.3 million, 890 SJC gold bars, 246 kg of raw gold, 31 supercars and seven high-end motorcycles, 59 luxury watches worth around VND300 billion, and 84 jewelry pieces made from gold and encrusted with diamonds.
Another shocking case is the investment scam involving the Danang-based GFDI Investment Consulting One Member Co., Ltd, established on May 17, 2018, with a charter capital of VND80 billion ($3.15 million).
Since its establishment, Nguyen Quang Hoang, who served as director, legal representative and chairman, had developed the company’s business model by borrowing money from the public through “asset borrowing agreements.”
From November 2023, due to investment losses and financial difficulties, in order to sustain the company’s operations, Hoang directed employees to “defraud to appropriate assets” from customers under the guise of signing loan agreements, using funds borrowed from new customers to pay off the debts of previous ones.
In early November 2024, the company lost its ability to repay 7,541 customers, with a total outstanding principal of over VND3.7 trillion ($145.76 million).
Tricks exposed
Despite the diverse and sophisticated forms, the common thread among financial frauds in the past year is that the perpetrators have a deep understanding of the desire for quick wealth among social media users. They exploited the naivety and lack of knowledge of individual investors to “set traps.”
Many fraudsters created glamorous, luxurious, and extravagant personas as a façade to portray themselves as successful financial experts to lure their victims. At the same time, they exploited technological platforms to carry out their fraudulent activities.
A survey conducted by the National Cybersecurity Association revealed that the three most common tactics include luring users into fake investment schemes that promise high returns, impersonating the identities of organizations or institutions to gain credibility and deceive victims, and scamming individuals with fake prizes or large promotional offers.
According to survey results, 70.72% of users have received invitations to invest in financial schemes on trading platforms of unknown origin, promising zero risks and high profits. This is not surprising, given recent cases such as Trieu Nu Cuoi (Million Smiles), a company masquerading as an investment firm and led by Ho Quoc Than, which was recently raided by Hanoi police.
To participate in the Trieu Nu Cuoi “ecosystem,” individuals and businesses were required to pay “blessing” fees to own the quantum financial system (QFS) currency, priced at VND4-5 million ($197) per QFS for individuals and VND39 million ($1,537) for businesses.
According to its advertisements, the QFS was supposedly backed by the legacy of multiple sources and families, preserved over hundreds of years. It was also claimed to be recognized by 48 countries and scheduled to be activated in October or November 2024 in Vietnam.
Participants in the “ecosystem” were promised financial support to restructure and grow their businesses without collateral or interest payments. Additionally, Than said if individuals or businesses wanted to withdraw from the scheme for any reason, he would return the money.
Police investigation showed that approximately 100 businesses and nearly 400 individuals had purchased QFS coins, with a total value amounting to tens of billions of VND (VND10 billion = $394,166).
Than had cultivated an image of a welfare conglomerate for the public’s benefit, in order to build trust among individual and business clients to purchase the coins.
At the same time, he instructed the issuance of “welfare cards,” which required an upfront payment of VND2.6 million ($102.5). For one year, customers could use the card to shop with special discounts, offering VND500,000 worth of purchases per week (available on Saturdays and Sundays).
The card had no geographical restrictions and was valid for use 30 days after purchase. To date, the company had issued over 2,000 welfare cards.
To boost sales of the “welfare cards” to the public, Than organized numerous livestream sessions on social media platforms like Facebook and YouTube, and hosted online meetings on Zoom, attracting participants from various provinces and cities.
He used Buddhist teachings to introduce the concept of welfare and his own commitment to spreading goodwill, promoting the company’s activities to a wider community.
Although Than had no official occupation, he rented luxury houses and set up the company’s office in prestigious locations, driving high-end cars to gain the trust of potential investors.
Before Than, there were even more sophisticated and larger-scale investment scams, which, of course, led to even greater losses for investors – the cases of Mr.Pips and Mr.Hunter.
Content retrieved from: https://theinvestor.vn/what-seen-from-exposed-multi-billion-dollar-financial-scams-in-vietnam-d14144.html.
