The Hanoi police caught an illegal dollar trading deal worth US$390,500 (about VND8.4 billion) at a branch of the Vietnam Export-Import Bank on March 8.

The police caught two individuals Nguyen Ngoc Tuan and Dao Manh Quan red-handed, while they traded in greenbacks with Nguyen Thi Thu Huyen and Duong Thi Thuy Trang. Neither Tuan nor Quan were licensed traders.

The entire amounts of $390,500 and VND8, 4 billion were seized by the police.

The Eximbank’s branch said that it didn’t know about the trading and its employees legally conducted the transaction in US dollar under a requirement by Huyen and Trang.

Earlier, the State Bank of Vietnam had announced that it would join hands with the police and market regulators to investigate and punish violators in dollar trading transactions in the black market. The concerted effort is meant to eliminate illegal dollar trading.

Major General Nguyen Tien Luc, deputy head of the Crime Prevention Police Bureau said the bureau will continue to coordinate with banks and related departments to implement strong measures to stop foreign currency trades in the free market and penalize violators.

Police will also check and monitor all foreign exchange counters and penalize those that quote products in dollars as well.

Foreign cash on black market can be confiscated

Illegal foreign exchange dealers will be given heavier penalties, including a confiscation of the money involved, according to the State Bank of Vietnam (SBV)’s new proposal.

The State Bank of Vietnam is drafting a new decree on administrative penalties for violations in the financial and banking fields.

Accordingly, violators of foreign exchange management regulations will be subject to new pecuniary penalty rates that are 5-7 times higher than those currently in effect.

The new decree, which will replace the existing Decree 202, is aimed at tightening control on the foreign exchange market, said Nguyen Hoang Minh, deputy director of the SBV’s Ho Chi Minh City Branch.

Chief Inspector of the SBV is authorized to give violators a fine of up to VND500 million (US$24,000), while the allowable rates for chief inspectors of SBV branches and SBV inspectors are VND30 million ($1,440) and VND500,000 ($24) respectively.

In addition to being fined, violators, whether they are individuals or entities, will have the cash involved confiscated.

Currently, the highest pecuniary penalty rate is only VND12 million ($576), Mr . Minh said.

He also said most citizens opt to sell their US dollars to jewelry shops rather than to banks, since the SBV’s foreign exchange rates are lower than those on the open market.

However, when the proposed penalty rates are applied, the selling of foreign currencies, especially US dollars, to jewelry shops will result in more loss than gain to dealers, he warned.

For safety, citizens should sell their foreign currencies to banks or credit institutions, he advised.

Source: SGGP/Tuoi Tre