Transferring the case of Novaland's violation of bond issuance to the Ministry of Public Security's investigation agency

On October 17, the Government Inspectorate publicly concluded on compliance with legal policies on the issuance of individual corporate bonds and the use of funds from individual corporate bonds, from January 1, 2015 to June 30, 2023.

During the period from January 1, 2015 to June 30, 2023, 67 organizations issued a total of 827 corporate bond codes with a total issuance value of VND 462,824 billion.

Particularly for No Va Real Estate Investment Group Corporation and its subsidiaries: 18 organizations issued a total of VND 67,105.54 billion in corporate bonds. The group of companies related to No Va Real Estate Investment Group Corporation issued VND 25,650.5 billion.

Mr. Bui Thanh Nhon is currently the Chairman of the Board of Directors at Novaland and directly directs and orients the group's operations.

As of June 30, 2023, there are 52 issuing organizations with outstanding bonds with a total number of outstanding bond codes of 387 and a total value of VND 195,349,293 billion.

According to the inspection conclusion, 5/18 issuers in the No. 1 Real Estate Company group did not comply with regulations in using bond money for the purposes of receiving transfers of charter capital of organizations and individuals at other enterprises, and cooperating in investment and business in the real estate sector.

However, during the implementation process, there were signs of using money from issuing corporate bonds for the wrong purposes, including creating transactions and transferring corporate bond money through many intermediary organizations and individuals for another company to use (Nova House Trading Joint Stock Company); the violations were complex in nature, and at the time of inspection, some issuing organizations had not yet paid the principal and interest of corporate bonds, causing risks to bondholders.

The total amount of corporate bonds from issuers through transaction creation and money transfer through organizations and individuals that has been transferred to Nova House Trading Joint Stock Company for use is about VND 7,084 billion 94 during the period from issuance to the time of inspection.

"Due to the scope of the inspection, the nature and complexity of the violations and methods in the transactions that could cause consequences and risks for many bondholders and for society; Nova House Trading Joint Stock Company is not subject to inspection, so the Government Inspectorate does not check and verify the purpose and nature of the transactions. The Government Inspectorate transfers information about the case to the competent authorities for consideration and handling according to the law for Nova Group and the four above-mentioned member companies," the Government Inspectorate concluded.

Regarding information disclosure, the inspection results on the information disclosure responsibilities of the issuing organizations showed that 17/18 issuing organizations violated information disclosure regulations such as not disclosing information on certain information and documents; disclosing information not within the prescribed time limit; information disclosure content not in accordance with regulations; information disclosure content not being complete...

Regarding related content, 02 issuers (No Va Group and Nova Final Solution Joint Stock Company) have overdue debt for both principal and interest of corporate bonds, 04 issuers (No Va Thao Dien Company Limited, Nova Saigon Royal Real Estate Investment Company Limited, Gia Phu Real Estate Company Limited, Thai Binh Real Estate Trading Joint Stock Company) have overdue debt for interest of corporate bonds, violating regulations on the responsibility of issuers in paying principal and interest of corporate bonds to investors;

No Va Group and companies including Gia Phu Company and Gia Duc Company issued corporate bonds to cooperate in business and develop real estate projects. However, these projects are not eligible to mobilize capital according to the law on housing or have not been opened for sale according to the law on real estate business.

In addition, through documents and reports on secured assets of a number of issuing organizations, it is shown that Gia Duc Company and BIDV Securities Joint Stock Company have not performed in accordance with regulations regarding a number of secured transactions such as land use rights and stocks.

Yellow River

Source: https://doanhnghiepvn.vn/kinh-te/chuyen-vu-viec-novaland-vi-pham-ve-phat-hanh-trai-phieu-sang-co-quan-dieu-tra-bo-cong-an/20251018105527760