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Friday,  Dec 15,2017,22:49 (GMT+7)

Buffer zone for the cheater

Son Nguyen
Friday,  Nov 24,2017,22:18 (GMT+7)
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Buffer zone for the cheater

Son Nguyen

Signs of cheating by a property broker named Alibaba have surfaced for over two months, but responses from State management agencies and law enforcement bodies have not been matching the extent of the company’s fishy business, as covered in local media. Now, all relevant agencies have stepped in, but much of the reaction from authorities, to date, has been limited to warnings, although losses and damages have been inflicted.

In fact, there are two companies of the same name, both under Nguyen Thai Luyen as CEO: Alibaba Real Estate Joint Stock Company and Alibaba Northwest Company, and as both in nature stem from the same root, local media refer to both as Alibaba.

The story began with a news story published on September 9, 2017 in Dau Tu newspaper, alleging Alibaba as a pyramid-scheme business with numerous signs of illegal trading. As the news spread, Alibaba convened a meeting with its salesmen and customers at the company’s headquarters on October 16, rejecting all accusations.

Alibaba has for months run ads on its products at numerous property projects, with the latest being a sprawling residential project in HCMC’s Cu Chi District. Earlier, the company has also bragged as owner of over a dozen of property projects around Long Thanh Airport in Dong Nai Province, plus many others in Binh Duong, Long An, Vung Tau, and so on. Such ads turn out to be fake news, while money from homebuyers is real.

Two weeks ago, the HCMC Real Estate Association, or HoREA, issued an urgent warning, accusing Alibaba of numerous legal offenses that will expose homebuyers to huge risks and destabilize the city’s property market. HoREA in its correspondence highlights irregularities at Alibaba, concerning its ads to sell plots of land for housing at Tay Bac Cu Chi Urban Area. The key point is that Alibaba was seeking to illegally sell others’ land plots.

Tay Bac Cu Chi Urban Area, covering nearly 100 hectares, still belongs to local residents there, Tuoi Tre reports, citing the HoREA correspondence. Compensations for affected residents have not been made, site clearance not yet done, infrastructure facilities still undeveloped, and investors for the project have not been chosen, so Alibaba’s move to sell such land plots has grossly violated the law, according to HoREA.

On Alibaba’s website, there remains an article introducing the company as the project owner and exclusive distributor, offering land plots at VND5.5-6.5 million per square meter, according to Bao Dat Viet. The article also carries an ad, saying the legality for the project is ensured, with ownership certificates to be issued to the buyer.

In explanations, Nguyen Huynh Tu Trinh as representative of Alibaba says in Tuoi Tre that the company is applying to become investor for the project, and Alibaba is simply taking deposits from customers. Trinh furthers that Alibaba has not signed any purchase contracts with customers, and any homebuyers refusing to buy such land plots after November 26 can take back the deposit, while others will earn 3% interest a month on the deposit. That may later on turn out to be a broken promise.

The cheat surrounding the Tay Bac Cu Chi Urban Area project is not a singular one committed by Alibaba though. Many salesmen have said Alibaba is the owner of 14 residential projects around Long Thanh Airport, from Long Phuoc from No. 1 to No. 14, according to Nguoi Lao Dong. These salesmen have pledged a profit margin of as much as 28% a year for customers.

However, authorities of Dong Nai Province’s Long Thanh District assert in Nguoi Lao Dong that not a piece of land there has ever been handed over to Alibaba.

The bogus owner Alibaba has also claimed many other projects under its management, according to Vnexpress. The Marine City project in Long Dien District of Ba Ria-Vung Tau Province, for example, belongs to Nam Hai Construction Co. Ltd., but Alibaba has also claimed itself as the project owner, says the news site.

To boast its strong financial capacity so as to persuade customers, Alibaba has managed to spur its charter capital at both companies. Alibaba Real Estate JS Company was first registered in May 2016 with chartered capital of VND1 billion, but the amount has leapt to VND1,600 billion now, while Alibaba Northwest Company was registered on October 12 this year with chartered capital of VND12,000 billion, all to be contributed in cash by a few shareholders, says Vnexpress.

Explaining on the colossal equities, a shareholder at Alibaba Northwest Company says in Dan Tri that such capital amounts are merely numbers, as capital will only be mobilized once the company is officially chosen as the owner of the Tay Bac Cu Chi project.

Several lawyers and experts have pondered how Alibaba could easily announce such incredible amounts of charter capital, without any agencies doubtful about its abnormal, fishy business.

As news stories spread, according to Vnexpress, customers have come to Alibaba to demand deposits back, understandably to no avail.

The HCMC Real Estate Association has also received a letter of accusation from a man named Tran Dung, who has placed deposits to purchase three land plots at Long Phuoc 5 in Dong Nai and now wants his money back. HoREA has demanded Alibaba to settle the case, but the company remains muted, according to Vietnamnet.

In fact, many competent agencies have now stepped in.

Following the HoREA correspondence, the HCMC Department of Natural Resources and Environment this Monday issued a notice warning customers of wrong information by Alibaba, and urging homebuyers to stay vigilant against cheats, Tuoi Tre reports. Other agencies have also done the same, including the city’s Department of Construction, and the municipal government itself. Most lately, according to Nguoi Lao Dong, the Ministry of Public Security has also launched a probe, demanding relevant agencies to provide information regarding Alibaba.

Cheats will be exposed, and crimes punished, as a matter of course. However, the fact that fishy business like Alibaba’s remains undisclosed for a long time is due to loose, unresponsive management, so to say. And, loose management is also the buffer zone for fraudsters.

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