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HANOI: Vietnamese police have raided a financial firm believed to owe nearly US$150 million to investors after hundreds of people gathered outside its offices demanding their money back, state media said on Monday (Nov 11).
The Ministry of Public Security (MPS) said in a statement that they were investigating GFDI Company, a financial investment consultancy, over “illegal capital mobilisation and fraud”.
Days earlier, around 300 people – many from other provinces – with money tied up in GFDI had protested in front of the firm’s headquarters and other offices in the central city of Danang, state-controlled news site VNExpress said.
Demonstrations in communist Vietnam are relatively rare.
The MPS said in its statement issued on Saturday that the company, which set up in Danang in 2018, owed 7,500 customers a total of US$147 million.
GFDI had been borrowing money from people through property lending contracts at high monthly interest rates, the MPS added.
After becoming insolvent in November last year, the company’s CEO allegedly ordered staff to begin a Ponzi scheme, an investment fraud that pays existing investors with funds collected from new investors.
It was not clear if GFDI’s CEO or any staff were taken into custody.
In victim groups on Facebook and the Vietnamese messaging platform Zalo, investors–several of whom said they were staff members who had lost their own money or funds given to them by family – discussed compiling evidence to file complaints.
“I put all my trust in the company, having asked my family and friends to invest hundreds of millions of dong (tens of thousands of US dollars) to provide extra income to improve our lives,” a victim wrote on a Facebook group.
“I became so confused and I cannot find my way in life, as I have lost everything,” the victim wrote.
GFDI could not immediately be reached for comment.