HANOI - A court in Vietnam sentenced two former executives of a state-owned shipping firm to death on Monday for embezzlement, an unusual harsh sentence in a communist country where prosecutions of top officials are rare.
Duong Chi Dung and Mai Van Phuc, respectively former chairman and chief executive of Vinalines, were found guilty of siphoning off 20 billion dong (S$1.2 million) and mismanaging state funds to the detriment of the country's economy.
In a case that caused losses of $17.3 million (S$21.7 million), eight other officials received sentences of between four and 22 years for embezzlement and "intentionally violating state rules on economic management with serious consequences", according to the verdict read in court.
Dung and Phuc were each ordered to repay $5.2 million (S$6.5 million).
The verdict comes as Vietnam's government seeks to restructure its hundreds of state-owned enterprises (SOEs) in an effort to revive an economy grappling with high levels of bad debt, much of which rests with its own companies.
As part of a plan to create state-owned national champions in the mould of South Korea's "Chaebol", Vietnam wanted to develop Vinalines into one of the world's top shipping companies.
But like many SOEs, which enjoyed almost unfettered access to credit, Vinalines, or Vietnam National Shipping Lines, expanded disastrously into non-core businesses like real estate and stock broking.
It was hit hard by the global economy slowdown from 2008 and ran up debts of $2 billion (S$2.5 billion) by the end of 2011, the government said in a report last year.