Fraud and Employee Embezzlement in Vietnam 2026: How Much a Foreign Company Can Recover, Articles 174, 175 and 353 of the Penal Code, the Criminal Complaint, Account Freezes and Enforcement After Judgment

Key takeaways

• How much you recover is decided in the first weeks, not at trial: whether the money is still in an account, whether your complaint names the accounts and assets to be frozen, and whether the suspect can still be found. A case that fails all three will recover little, however strong it is on paper.
• The police first screen out "criminalising a civil dispute". A counterparty who exists, is reachable and simply did not perform is a civil matter; one who used a false identity or forged documents, or never had the capacity to perform, is fraud. The complaint has to prove intent with documents, not describe the loss.
• Three articles cover most cases: fraud (Article 174, threshold VND 2 million), abuse of trust (Article 175, VND 4 million) and embezzlement (Article 353, VND 2 million, which clause 6 extends to private companies). File under the wrong one and the file comes back as a civil dispute.
• Embezzlement of VND 500 million or more has no limitation period at all (Article 28). Below that, limitation runs 5 to 20 years from the date of the offence, not from discovery.
• Three things in the first week: secure the electronic evidence before confronting anyone; find out the suspect's accounts and assets; file the complaint with a written request for freezing attached. Freezing and seizure can only be applied once the suspect has been charged, but accounts named in advance can be frozen the day that happens.
• After judgment, the compensation order is a judgment debt. Under the Law on Civil Judgment Enforcement in force since 1 July 2026 it must be filed for enforcement within five years, and if the convicted person has nothing today the enforcement office checks again at least every six months. The debt does not expire.
• For a US company: since 11 September 2026 an apostille is enough for the parent's documents. There is no extradition treaty and no mutual legal assistance treaty between the United States and Vietnam, so a suspect who has left for the United States, or assets held there, are reached case by case and slowly, if at all.

Two calls in the same week happen at our office more often than you would think. Between them they cover almost everything a foreign-owned business in Vietnam will meet.

The first: a foreign-invested factory in Dong Nai paid a 30% deposit to a new packaging supplier. The director, the website and the showroom had all checked out. After the second instalment the phone went dead, and the company at the registered address had never heard of him.

The second: a US-owned trading company in Ho Chi Minh City found that its chief accountant of six years had been paying "suppliers" that were her relatives' companies. About VND 4 billion over three years.

Both clients asked the same question: is this criminal or civil, and if criminal, what exactly do we do? Underneath it was the question they asked second and worried about first: will we get the money back? This guide answers both in the order the problem actually arrives, under Vietnamese law as it stands in November 2026, after the 2025 reorganisation of the police, the courts, the Penal Code and the Criminal Procedure Code.

The conclusion first: three things decide how much comes back

Whether you recover anything depends on three things, and all three are settled in the first weeks, not at trial.

• How much money is still in an account. A freeze reaches only what is still there. Money already withdrawn or sent abroad has to be traced through the flow of funds and the suspect's other assets, which is slower and far less certain.
• Whether you asked for a freeze, and how specifically. Freezing and seizure are discretionary measures, and the agency acts on what you give it. A complaint that names account numbers, licence plates and land plots is in a different position from one that describes the loss and hopes the agency will look.
• Whether the suspect can still be found. Once a person has left Vietnam the investigation is usually suspended until they are located, and a compensation order has nothing to attach to in the meantime.

Run the two opening cases through those tests and the difference is immediate. The accountant is a known person and the payments went to companies that can be named: a definite defendant and a money trail that leads somewhere. The packaging supplier was not who he said he was and left nothing to follow: nobody to charge and no account to put in the complaint.

That does not make the second case pointless. A conviction turns the loss into an enforceable debt that outlives the trial by years, and the powers to freeze and trace money are available only through the criminal process. But it does mean that the honest answer to "will we get it back" comes from the three tests above and not from how well the complaint is written, and a supplier-disappearance case discovered late usually fails all three. Be sceptical of anyone who promises a recovery figure at the first meeting.

If you are reading this in the first week of a case, three things matter more than anything else here: secure the electronic evidence before confronting anyone; find out the counterparty's accounts and assets; and file the complaint together with a written request for freezing. The sections below explain why.

1. A crime, or just a bad deal?

Every foreign complaint has to pass this screen first, and it has nothing to do with how much money was lost.

Vietnamese investigators are trained to refuse what the system calls "hình sự hóa quan hệ dân sự", turning a commercial dispute into a criminal case. A supplier that took your deposit and then collapsed is a civil claim, however angry you are. A supplier that never had the goods and built the relationship to collect the deposit is fraud. The money lost is identical; the whole difference lies in what the other side intended and from when.

So a complaint that reads like a collection letter is returned, and one that proves intent with documents is accepted. What the agency looks for:

The Dong Nai case lands in the left column on almost every line. If your facts only fill the right column, the correct route is a commercial action in the regional People's Court or VIAC arbitration, and no rewriting of the complaint turns it into a criminal case. The civil route, with its limitation period, court fees, account freezes and enforcement, is in Collecting Unpaid Invoices from a Vietnamese Buyer 2026: The Two-Year Limitation, Regional Courts, Account Freezes and Why a US Judgment Is the Hardest Route ; where the contract has an arbitration clause, see Arbitration in Vietnam 2026: VIAC's New Rules, Enforcement and Clause Drafting for Foreign Investors .

2. Which article: the wrong one stalls the file

Three Penal Code articles cover almost every case foreign companies bring to us. Choosing between them is not a formality: filed under the wrong article, the whole matter is read as a civil dispute and returned.

Two points in the table deserve a pause.

Embezzlement in a private company is a corruption offence. Article 353 sits in the corruption chapter, and clause 6 pulls private enterprises in. That is why the Ho Chi Minh City accountant's position is more serious than her job title suggests: VND 4 billion falls in the top bracket, and a life sentence for embezzlement can now be reduced only where the convicted person has returned at least three-quarters of the property and actively cooperated or rendered exceptional service (Article 63 as amended in 2025). The death penalty for the offence was abolished the same year.

The dividing line between the three is control. Where the property was already within the employee's management, the cash she handled, the stock he signed for, the account she operated, Article 353 applies. Where the employee had no such control and deceived the company into releasing money, Article 355 or Article 174 fits better. Forging invoices to cover a diversion she could make anyway does not change the answer: it is still embezzlement, and the forgery is an aggravating factor.

One variant has its own article. A spoofed supplier email, or a fake "customs fee" portal that diverts a payment, is normally charged under Article 290 (using computer or telecommunications networks to appropriate property), and fraud remains available on the right facts. In these cases the law matters less than the clock: notify the bank within hours. A completed domestic transfer cannot be reversed on request, and whether the money survives depends on whether the receiving bank acts before it is withdrawn.

3. Are you still in time?

The Ho Chi Minh City case ran for three years before discovery, and companies in that position usually assume the early years are lost. At that amount, they never are.

Article 28 of the Penal Code excludes embezzlement under Article 353 clauses 3 and 4, broadly VND 500 million and above, from limitation altogether, in the same sentence as offences against national security and war crimes. Whenever it is discovered, it can be prosecuted. The same is true of serious bribery.

Below that line limitation runs, and from the date of the offence rather than the date you found out: 5 years for less serious offences, 10 for serious, 15 for very serious and 20 for especially serious (Article 27). Which category applies depends on the bracket the amount falls into, so the same conduct may carry a 5-year or a 15-year period. If the suspect commits a further offence punishable by more than a year's imprisonment, the period restarts; if the suspect absconds and a wanted notice is issued, it restarts from surrender or arrest.

Where a diversion ran for months or years as a single continuing course of conduct, practice counts from the last transaction, not the first. If your facts are anywhere near the line, settle the arithmetic with counsel before filing: the agency will do the sum, and a complaint that is out of time is simply not accepted (Article 157).

4. Will reporting it turn the spotlight on you?

This question is rarely asked first, but it deserves a direct answer, because left unanswered it is exactly the doubt that stops a complaint being filed at all.

The concern is legitimate. The answer is that the risk is real but narrow, and almost always manageable if it is handled before filing rather than after.

Verification is directed at the elements of the offence and the suspect's conduct. There is no automatic referral to the tax authority, and the investigating agency is not a tax inspectorate. What does happen is that your documents enter the file: contracts, invoices, bank statements, approval rules and, in an employee case, payroll and personnel records.

The exposure sits in three places. First, the accounting entries the fraud itself created: fake supplier invoices that were booked and declared, payments to accounts that match no declared counterparty, which are visible on the face of the evidence you submit. Second, the dismissal: a procedural defect gives the employee a separate labour claim, which is far more likely than any tax problem. Third, a counter-allegation that the payments were commissions the company knew about and approved.

So do an internal review before filing. Reconcile the affected accounts, identify the entries booked on false documents, and take tax advice on correcting them: a voluntary correction before any file exists is treated very differently from the same irregularity discovered later. Settle with counsel what the complaint needs to contain, which is proof of the elements of one offence, a much narrower set than the whole accounting system. For a company with clean books, the real cost of filing is time and disclosure, not legal risk.

5. The first week

The case is won or lost in this window, and the window closes before the police are involved.

• Secure the evidence before confronting anyone. Suspend system access, image the laptop, preserve emails and accounting records. In that order, the evidence is still there when you need it. Confront first, and the records may be gone before anything is secured.
• Interview with a witness and a written record. An admission the employee writes and signs is strong evidence, but it must be voluntary. Detaining her, taking her passport or threatening her is itself an offence, and it voids the statement.
• Treat the dismissal as a separate track with its own deadline. Article 125 of the Labour Code lists theft, embezzlement and disclosure of business or technical secrets as grounds for dismissal. Article 122 requires the employee to be present and able to defend herself, the grassroots employee representative organisation to take part, and minutes to be kept. The limitation period is 6 months from the violation, extended to 12 months where finance, assets or trade secrets are involved (Article 123). A dismissal that skips the procedure is unlawful even where the embezzlement is proven, and she can claim reinstatement and back pay while being prosecuted. A US employer used to at-will termination should assume the opposite: in Vietnam the procedure is the protection.
• Mind the Personal Data Protection Law. Reviewing an employee's work email and company systems for an internal investigation is permissible where your internal regulations provide for it; accessing her personal accounts or devices is not. If the regulations are silent, fix that before the next case.

6. File, then wait

The victim is usually the Vietnamese subsidiary, so the complaint is signed by its legal representative. If the US parent paid the money directly, the parent is the victim and its corporate documents (certificate of incorporation or good standing, board resolution, power of attorney) must be authenticated. Since 11 September 2026 Vietnam applies the Hague Apostille Convention under Decree 293/2026/ND-CP, and the United States is a contracting party, so an apostille from the Secretary of State of the relevant state (or the US Department of State for federal documents) replaces consular legalisation. The apostilled documents still have to be translated into Vietnamese and the translation notarised or certified in Vietnam. Allow a couple of weeks, and start it in parallel with everything else.

Where the complaint goes changed in 2025. District police ceased operation on 1 March 2025, some 694 units, and the provincial Investigation Police Agency now runs most economic crime cases. Commune police receive complaints, carry out preliminary verification and send the file up; commune police chiefs who are qualified investigators may be assigned to investigate less serious and serious offences themselves. In practice you file with the commune police where the offence occurred or the suspect lives, or directly with the provincial agency, and anything above the lowest brackets ends up at provincial level. The courts were reorganised in step: regional People's Courts replaced district courts as the first instance.

What goes in the file: the complaint itself, written chronologically, naming the article you say applies and the amount; contracts, invoices, delivery records and transfer slips; the evidence of deception or concealment; in an employee case the employment contract, job description, approval rules, audit report and the bank statements showing where the money went; what you know of the suspect's identity number, address, accounts, vehicles and real estate; and a specific written request for freezing and seizure, with the compensation you claim. Evidence must be in Vietnamese or in a notarised translation, and electronic data must be preserved in a verifiable form: original emails with headers, server logs, and ideally screenshots recorded by a bailiff office as a vi bằng.

Then the waiting starts, on the Criminal Procedure Code's timetable:

A clean employee case with bank records takes two to four months from complaint to the decision opening the case. Supplier fraud where the suspect has vanished takes longer and may be suspended until the person is found. The step that stretches the timetable is valuation: where the loss is stock, equipment or work in progress rather than a cash transfer, the agency must commission a formal valuation before it can fix the bracket. Your own reconciliation and auditor's report cannot replace it, but they shorten it and reduce the risk that the figure comes out in a lower bracket than the facts warrant.

7. When nothing happens

Foreign victims are often told the decision rests entirely with the investigating agency. It does not; the steps below are open to you.

If the agency decides not to open a case, it must send the decision and the file to the competent Procuracy within 24 hours (Article 158). The Procuracy can cancel a decision it considers unlawful and open the case itself (Article 153(3)(a)), and anyone who filed a complaint has an express right to appeal. You are entitled to a copy of the decision; if none arrives, ask for it in writing.

The appeal periods are short and stacked. An appeal must be filed within 15 days of receiving or learning of the decision (Article 471). It goes to the head of the investigating agency, who has 7 days (Article 475). If you disagree with that result you have only 3 days to take it to the competent Procuracy, which then has 7 days. Three days is short enough to pass while you are still deciding what to do. An appeal against the head of the agency personally, or against a decision the Procuracy has already approved, goes straight to the Procuracy.

More often there is no decision, only silence. The practical remedy is a written request to the Procuracy supervising the case, citing the date on the acknowledgement, asking it to review how the complaint is being handled. That puts a record on the file; repeated calls to the investigator do not. Two things make it work: you kept the acknowledgement, and your letter points to the element the agency appears to have missed, the forged document, the account the money reached the same day, rather than restating the size of the loss.

8. Freezing, compensation, and a debt that outlives the trial

This is where the criminal complaint earns its keep, and where most of the money is saved or lost.

The investigating agency can seize property (Article 128) and freeze bank accounts (Article 129) to secure the compensation claim, and the judgment itself can order the convicted person to return property or pay damages (Criminal Procedure Code Article 30; Penal Code Article 48). One limit to know before relying on them: these are coercive measures, seizure applies only to a person who has been charged (bị can) or is on trial (bị cáo), and an account freeze only to a person being prosecuted. Neither is available while the file is still in verification. Usefully, a freeze can also reach a third party's account where there are grounds to believe the money in it is connected to the offence.

That is why the written request belongs in the complaint even though nothing can be frozen yet. A complaint that already names the accounts, vehicles and land lets the agency act on the day the suspect is charged instead of starting to look. Quantify the loss at the same time with your own reconciliation and auditor's report; the formal valuation will still be done, but faster.

Decide the timing of any settlement in advance, not in the moment. Fraud, abuse of trust and embezzlement are not among the offences in Article 155 that are prosecuted only at the victim's request, so withdrawing the complaint does not end the case. Voluntary restitution is a statutory mitigating circumstance (Article 51), which is exactly why suspects and their families tend to offer payment once the case is opened. The usual structure is a written settlement recording the repayment and your position on sentencing, filed with the agency. A settlement signed before filing in exchange for not filing buys none of that leverage and may raise questions of its own.

A judgment that finds the defendant has nothing is not the end either. The compensation order is enforced like any judgment debt under the 2025 Law on Civil Judgment Enforcement, in force since 1 July 2026. You must file for enforcement within five years of the judgment taking effect (Article 34). Where the convicted person has no assets, the enforcement office records that there are "no conditions for enforcement yet" (Article 38) and checks again at least every six months, or at least once a year where the person still has two or more years to serve or no known address. After two years without change the file is returned to you and can be refiled when circumstances change, and that time does not count towards the five years, nor does any period of force majeure or objective obstacle you can prove. Meanwhile the debt carries leverage: conditional early release requires that fines, costs and compensation have been paid (Penal Code Article 66). That gives you a point of pressure that still exists years after the trial, and one the convicted person has a direct interest in resolving.

What a US company can and cannot do across the border

Two things a US victim tends to assume are not available. There is no extradition treaty between the United States and Vietnam, and no mutual legal assistance treaty in criminal matters; Vietnam's 2025 Law on Mutual Legal Assistance in Criminal Matters applies reciprocity where there is no treaty, and in practice cooperation is case by case and slow. A suspect who has reached the United States will not be returned on Vietnam's request, and a Vietnamese investigator will not obtain US bank records quickly, if at all. In the other direction, enforcing the Vietnamese compensation order against assets in the United States means asking a US court to recognise the civil part of the judgment under state law on foreign money judgments, with the same hurdles that apply to any Vietnamese judgment, so a case whose money and suspect are both in the United States is usually a US case. What the Vietnamese process does deliver is the freeze on Vietnamese accounts and assets, which no US proceeding can reach.

9. The law is about to change, and embezzlement is affected most

A comprehensive amendment of the Penal Code is before the National Assembly, whose second session opened on 17 October 2026 and is scheduled to close on 21 November 2026; as of early November the amendment had been debated but not yet passed. Under the draft published in mid-2026, the changes relevant here are these. Fraud (Article 174): the prosecution threshold rises from VND 2 million to VND 5 million, the bracket amounts stay, and the minimum sentences rise. Abuse of trust (Article 175): the threshold rises from VND 4 million to VND 10 million, brackets unchanged. Embezzlement (Article 353) changes most: the threshold and the bracket amounts rise substantially, the figures differ between draft versions, and the version the National Assembly passes will govern.

The practical consequence is narrow but worth knowing. The more lenient law applies to the accused, so filing today does not lock in today's brackets. An embezzlement amount that falls in a higher bracket now may drop a bracket once the amendment passes; a VND 4 billion case stays in the top bracket either way. What filing now does achieve is procedural: the case is opened, the suspect is identified and the accounts are frozen under the current rules, ahead of any uncertainty in a transition period. That, and not the sentencing bracket, is the reason not to wait.

Frequently asked questions (FAQ)

Our supplier took the deposit and disappeared. Is that fraud or a contract dispute?

If he used a false identity or forged documents, or never had the capacity to perform, it is fraud under Article 174. If he is a real person who took the deposit under a genuine contract and then diverted it and avoided you, it is abuse of trust under Article 175. If he is real, reachable and simply failed to deliver, it is a civil claim.

Can a private-company accountant really be charged with embezzlement?

Yes. Article 353 clause 6 applies the offence to persons holding positions in non-state enterprises. The threshold is VND 2 million, and the 7 to 15 year bracket starts at VND 100 million.

He has repaid us. Can we withdraw the complaint?

You can withdraw it, but the case continues. These offences are not prosecuted only at the victim's request. Restitution is a mitigating circumstance at sentencing, so record the settlement in writing and file it with the agency.

The police refused to open a case. Is that final?

No. Appeal within 15 days of receiving the decision, and note that if you disagree with the reply you have only 3 days to take it up a level. The Procuracy supervising the case can cancel a refusal and open the case itself. Section 7 has the full sequence.

We won, but he has nothing. Was it all for nothing?

No. The compensation order is a judgment debt waiting for assets, income or an inheritance to appear, and the enforcement office rechecks at intervals. File for enforcement within five years of the judgment taking effect, and remember that paying the compensation is a condition of his conditional early release.

Can our US parent company file the complaint, and what documents does it need?

Yes, if the parent paid the money and is therefore the victim. Since 11 September 2026 its corporate documents need only an apostille, not consular legalisation, plus a notarised Vietnamese translation. Where the Vietnamese subsidiary paid, the subsidiary is the victim and files in its own name.

The suspect has left for the United States. Can Vietnam get him back, or reach his US accounts?

Not in any practical sense. There is no extradition treaty and no mutual legal assistance treaty between the United States and Vietnam; cooperation is case by case. The Vietnamese case will usually be suspended until he returns, and his US assets are reached, if at all, by recognising the civil part of the Vietnamese judgment in a US court.

How Louis Group can help

Louis & Partners Vietnam handles the whole sequence for foreign companies: the first evidence review, the complaint, the request for freezing and seizure, the victim's participation in the investigation and trial, and the compensation order and its enforcement. Our Ho Chi Minh City and Hanoi offices work in Vietnamese, English and Chinese.

If you are in the first week of a case, call before you confront anyone. That one decision determines how much evidence is left by the time the file reaches the police.

Author: Stella Vu , Senior Partner, Louis & Partners Ho Chi Minh City.

This article states Vietnamese law and practice as of November 2026, under the Penal Code and Criminal Procedure Code as amended with effect from 1 July 2025 (Laws 86/2025/QH15 and 99/2025/QH15), the Law on Civil Judgment Enforcement in force since 1 July 2026 (Law 106/2025/QH15), the 2019 Labour Code, and the Penal Code amendment before the National Assembly. It is general information, not legal advice; contact us about your own case.

Related reading

• Collecting Unpaid Invoices from a Vietnamese Buyer 2026: The Two-Year Limitation, Regional Courts, Account Freezes and Why a US Judgment Is the Hardest Route
• Arbitration in Vietnam 2026: VIAC's New Rules, Enforcement and Clause Drafting for Foreign Investors
• Arrested in Vietnam as a Foreigner 2026: How to Reach a Lawyer in Hours, Not Weeks