HANOI, Vietnam -- According to the Agence France-Presse on Monday, a court in Vietnam sentenced two former top executives of a state-owned shipping company, Vinalines, or Vietnam National Shipping Lines, to death for embezzlement; an unusually harsh sentence in a communist country where authorities are trying to allay rising public anger over corruption.
Former Vinalines chairman Duong Chi Dung, who fled the country and was later apprehended, and the group's chief executive Mai Van Phuc were given the death penalty after a three-and-half day trial where they were found guilty of siphoning off 20 billion don ($950,000 USD) and mismanaging state funds to the detriment of the country's economy.
"Dung's behavior caused especially serious consequences," said court president Ngo Thi Anh. Dung, 56, fled after the scandal broke in May 2012 when Vinalines defaulted on loans. He was arrested in September last year in neighboring Cambodia after three months on the run.
Dung an Phuc were each order to repay $5.2 million.
The harsher verdict comes as Vietnam's government seeks to restructure its hundreds of state-owned enterprises (SEOs) in a effort to revive an economy grappling with high levels of bad debt, much of which rests with its own companies. Vietnam wanted to develop Vinalines into one of the world's top shipping companies. But like many SOEs, which enjoyed unfettered access to credit, Vinalines expanded disastrously into non-core businesses like real estate and stock broking.
"All the defendants were (communist) party members, but became rotten in their nature (and) need to be seriously punished before law," the court ruled.
Eight other defendants, all officials at Vinalines or other state-owned entities, were given between four and 22 years in jail on charges of defying state regulations and embezzlement.
"I did not take any money. I have been wrongly charged," Dung told the court.
He did however, accept some responsibility for the Vinalines debt scandal, and apologized to "the party, state, national assembly, government, people and Vinalines employees."
The trial follows the sentencing last year of nine former top executives at scandal-tainted state shipbuilder Vinashin, who were given lengthy jail terms on similar charges.
Concerns over state-owned firms were first triggered by Vinashin's near-collapse in 2010 under billions of dollars of debt.
Some of its loss-making sea transport projects were transferred to Vinalines, though experts warned the shipping company was ill-prepared to manage them.
Vietnam is ranked as one of the world's most corrupt nations and graft is a top concern for many ordinary people. Corruption, mismanagement and huge debts at state-run companies are seen as fueling the country's economic woes.
Last month a former banker and his business associate at a large state bank were sentenced to death for embezzling $25 million.
Vietnam does not disclose the number of executions it carries out each year, but rights group Amnesty International recorded five in 2011 and 23 new sentences handed out that year, mainly to drug traffickers. Murder, rape and some serious financial crimes can also carry the death penalty.
The Southeast Asian economy grew 5.25% in 2012, the slowest pace in 13 years. Despite Vietnam's SOE problems, lawmakers last month approved an amended constitution that affirmed the state sector must "play the leading role" in the economy. Foreign investors express disappointment and said they needed to see more evidence of the government's willingness to reform the inefficient state-owned system and create a level playing field for private sector firms. Was Monday's verdict a response?