Vietnam Steel (TVN) Bribery Probe: VND 13B State Loss, Ex-CEO Took VND 18.4B

Overview

Vietnam’s Ministry of Public Security has completed a supplementary investigation into a bribery case at Viet Trung Mineral and Metallurgy Company, implicating former executives of Vietnam Steel Corporation (VNS, listed as TVN on UPCOM). The probe found that overpriced coking coal purchases caused state losses exceeding VND 13 billion, with former Viet Trung CEO Bui Thanh Binh allegedly receiving VND 18.4 billion in kickbacks.

Key Facts

• Former Viet Trung CEO Bui Thanh Binh allegedly received VND 18.4 billion from Nguyen Van Binh, Chairman of Viet Phat, and Nguyen Xuan Tot, Director of Trung Thanh.
• Overpriced coking coal purchases from Viet Phat and Trung Thanh caused total damages of VND 29.3 billion, of which state capital losses exceeded VND 13 billion.
• Before 23 February 2016, Vietnam Steel Corporation (VNS) held 46.85% of Viet Trung, and Lao Cai Mineral Company (LAMICO) held 2%; state losses in this period exceeded VND 10 billion.
• After LAMICO divested on 23 February 2016, VNS’s share of losses was over VND 3.2 billion.
• 31 defendants were recommended for prosecution in July 2026, including former Lao Cai provincial officials Le Ngoc Hung and Do Truong Giang.
• The investigation covers coking coal contracts signed between 2015 and 2020.
• TVN shares closed at VND 9,500 on 11 October 2026 on the UPCOM exchange.

What Happened

According to the supplementary investigation conclusion from the Ministry of Public Security’s Police Investigation Agency, Bui Thanh Binh, former General Director of Viet Trung, colluded with Nguyen Van Binh and Nguyen Xuan Tot to favor their companies as coking coal suppliers. In return, Bui Thanh Binh received VND 18.4 billion. The investigation determined that Viet Trung purchased coking coal from Viet Phat and Trung Thanh at above-market prices, resulting in total damages of VND 29.3 billion.

The agency calculated state capital losses based on ownership ratios and contract timing. Before 23 February 2016, when VNS held 46.85% and LAMICO held 2%, state losses exceeded VND 10 billion. After LAMICO’s divestment, VNS’s share of losses was over VND 3.2 billion, bringing total state losses to more than VND 13 billion. The investigation also recommended prosecution for 31 defendants, including former Lao Cai provincial officials Le Ngoc Hung and Do Truong Giang, for abuse of power.

Market Context

TVN trades on the UPCOM exchange, Vietnam’s unlisted public company market, and closed at VND 9,500 on 11 October 2026. The steel sector has faced headwinds from global price volatility and domestic demand fluctuations, and this legal development adds a governance overhang. The case is part of a broader anti-corruption drive in Vietnam that has touched multiple state-owned enterprises, potentially affecting investor sentiment toward SOE-linked stocks.

Strategic Significance

For long-term investors, the case highlights governance risks at Vietnam Steel Corporation, particularly its historical oversight of joint ventures. The alleged bribery and resulting state losses underscore weaknesses in procurement controls and capital allocation. While the financial impact on TVN may be limited relative to its balance sheet, the reputational damage and potential for stricter regulatory scrutiny could weigh on future joint-venture operations and capital-raising efforts. The outcome may also influence how the state manages its remaining stake in the company.

What to Watch

• The formal indictment and trial schedule for the 31 defendants, including any TVN executives.
• Any regulatory penalties or remediation requirements imposed on Vietnam Steel Corporation.
• Changes in TVN’s ownership structure or state divestment plans.
• Quarterly earnings disclosures for any provisions related to the case.
• Updates from the Ministry of Public Security on asset recovery efforts.