Phan Sao Nam believes that the card game business is protected by the police.

On the afternoon of November 17, after nearly a week of working, the People's Court questioned the criminal acts of defendant Phan Sao Nam (39 years old, Chairman of the Board of Directors and Director of VTC Online Media Joint Stock Company - VTC Online).

Ambition to be the pioneer in developing online card games

In a white shirt, dark jeans, sleeves rolled up neatly in layers, Nam calmly said he was not related, only knew Nguyen Van Duong (Chairman of CNC Board of Directors) through normal social relationships since 2015. As for Hoang Thanh Trung (who is on the run), Nam had a 5-year colleague relationship at VTC Corporation.

Nam had long heard that CNC was a front company for the police. When he met Duong, Nam was confirmed this. With VTC Online's long history of technology and internet business, Nam and Duong discussed plans to develop business in this field.

Trung met Nam again to discuss the development of card games. But according to Nam, licensing games in 2014-2015 was quite difficult. When meeting Duong, this defendant said he could do it as a publisher. The trio cooperated from then on.

At Nam Viet Company, Trung is in charge of the branch in Hanoi that licenses software to VTC Online, then VTC Online licenses it to CNC to release games in Vietnam. Nam and Duong both expect to be the pioneers in developing online card games.

During his time working with CNC, Nam realized that the game was not licensed. "Why did you cooperate even though you knew it was difficult to get a license, but you didn't get one?", the judge asked. Nam asked the jury to give a long presentation.

Accordingly, Nam was told by Duong that CNC was a front company that both did business and had the task of offline reconnaissance. As soon as Nam finished saying this, the chairman asked police officer Duong to leave the isolation room to listen.

Continuing to explain, Nam stated that when he heard Duong say that, he understood that even though there was no license yet, the Ministry of Public Security could have an open mechanism for the professional company to carry out the game without outsiders knowing. Therefore, the two companies had a formal contract and Nam confidently developed this game.

"In the cooperation between VTC Online and CNC, the greatest value lies in the fact that CNC is a front company for the police," Nam said.

Nam said that the preparation of the server infrastructure was implemented by VTC online in the first phase. In phase one, the game was named Rikvip, and in phase two it was changed to Tipclub. The reason for the change, according to Nam, is unclear, but because this was Duong's wish, the nature of the service is the same.

Explaining to the prosecutor, Nam said that the Rikvip/TipClub card game has five payment methods: telecommunication card top-up, bank top-up, Gocoin, Vcard, and Mycard international payment. Nam has never tried to open the Rikvip game to play, so he does not know specifically how to top-up.

During the process of executing the contract with CNC, when connecting the technical game system, the two sides had to exchange a lot of information, including the server's IP information. The prosecutor asked Nam to look at the screen. The projector marked a number of IP addresses that were said to have been given to CNC by VTC Online. Nam confirmed that he had given these two IP addresses.

In phase one, Nam declared that the money earned from operating the game was fully accounted for by VTC Online company, which was more than 2,000 billion VND. In phase two, Nam declared that the money earned from operating the game was no longer accounted for by the legal entity.

Many agencies checked but no one handled it

Also during the interrogation this afternoon, Nam stated that during the game's operation, some authorities such as the Ministry of Information and Communications and PC50 Hanoi inspected this system.

According to Nam,The authorities knew about the release, the company itself had a full report but there was no conclusion. Therefore, the defendant believed the defendant Duong's words about the game being tested and then this product was officially licensed.

In the first phase, from April 2015 to August 2016, CNC signed a contract with VTC Online and did its job well. From Nam's perspective, CNC was very confident and Duong was also confident in negotiating with the authorities to get a license.

In the second phase, according to Nam, Duong no longer used the CNC legal entity to operate the gambling system but used a number of other legal entities. However, Nam said that the tasks that the defendant Duong represented were all implemented in accordance with the original agreement.

Nam recalled that around August 2016, Duong discussed that CNC was a front company and was sensitive, so he "wanted to make it less sensitive." "No matter how sensitive it was, I didn't feel comfortable asking, because it was related to the Ministry of Public Security, and I knew it was confidential information," Nam said.

The judge asked: "Why were you not punished after the authorities inspected you?". Nam said he didn't know, but he had discussed it with Duong during all the inspections. At that time, Duong said, "I will handle it and work with those authorities." Behind him, Duong attentively watched Nam's testimony.

Nam also affirmed that if at the early stage when the management agencies inspected, they had warned about the unlicensed game, there would not have been consequences like today's case.

Deposit $3.5 million in a bank account in Singapore

While confessing and thinking, Nam explained that the game was a prize exchange game, so most of the revenue of more than 9,500 billion VND in nearly 30 months of operation was used to exchange prizes for players. Nam received money to cover the operating costs of hard and soft copies..., but he did not directly operate the technology but through his colleague Hoang Thanh Trung, so he did not know the costs and only transferred them upon request.

During more than two years of card game business, Nam said he received 1,475 billion VND. With this money, Nam said he kept most of it in cash, and contributed some capital to establish a number of companies, new business fields, and real estate.

The judge asked him to declare how he used the money. Nam stated specifically as in the indictment, including transferring it to relatives and friends to keep for him (his aunt, friends named Hung, Nhung) or investing in digital content production companies, payment software industry, tourism... With his aunt, Nam transferred 236 billion VND to ask her to keep it for him and then invest it to make a profit. When asking his friend to keep the money, Nam did not say where the money came from.

Nam stated that during the investigation phase, he had paid 1,088 billion VND in cash to the investigation agency. Nam's total assets that were recovered were more than 1,300 billion VND, equivalent to 90.7% of the illegal profits. Nam stated that he had reimbursed this amount immediately after being detained for more than a month, when he realized his mistake. Nam also said that now he realized his mistake, so he hoped that the fugitives, who were also his close friends, would return to admit their mistakes. Listening to Nam's statement, the People's Procuracy assessed that Nam had actively cooperated with the investigation agency to remedy the consequences.

With the $3.5 million currently in Singapore, Nam said he lent it to a friend in Vietnamese Dong. But then the friend paid the defendant in Singapore in USD through an account in this country. "There was no cross-border money transfer," Nam said.

The prosecutor asked Nam to look at the screen again. The projector showed the minutes of the meeting with the prosecutor and investigator about the frozen assets. Nam said that the information that the prosecutor had checked the numbers was correct.

In response to the lawyer's question: "Some people say Phan Sao Nam is mentally ill to have recovered such a large amount of money. What do you think?" Nam said: "That is a large amount of money, so it is not right to say that it was a snap of the fingers, but after working with the investigation agency for more than a month, the defendant realized his mistake, and with the investigation agency's support, in just over two weeks Nam was able to recover that amount of money, which is also less than two months since he turned himself in."

Nam also promised that during the execution of the sentence and after that, he would have the opportunity to work and contribute to society to help remedy the consequences.

"There was a time when the defendant was on the run and wanted. Why did he run away knowing that there was an investigation?", the panel of judges asked further. Nam said that because he was on a business trip abroad, he did not receive information about the prosecution or wanted person. But during this time, he heard about the case in Vietnam.

"It was a shock and the defendant wanted to think about the past. The defendant had not had any legal experience and did not know what prosecution, investigation, or wanted was, so he wanted to be alone to think before returning home," Nam said.

The lawyer cited that on November 8, 2017, Nam wrote a petition asking formake a contributionatonementwith the content of requesting the investigation agency to create conditions to contact friends and colleagues such as Hoang Thanh Trung, Le Van Kien, Phan Anh Tuan, to persuade them to cooperate with the investigation agency and ask "why did you have that idea?".

Nam replied that at that time, as well as until now, he realized that what he did was wrong. The defendants above should also realize that what they did was wrong, so they should quickly return to cooperate with the investigation agency, resolve the case as well as remedy the consequences as soon as possible.

27 months of game operation, revenue of nearly 10,000 billion VND

The case file determined that in 2014, Phan Sao Nam met Hoang Thanh Trung (on the run, former director of the software center - VTC Technology and Digital Content Company - VTC Intecom) and was bragged by Trung that he owned software and a team of good technicians who could develop and operate an online gambling software system in the form of card games.

Trung proposed to find a legal entity for himself to build and develop online gambling software. In response, Nam contacted Do Bich Thuy (owner of Nam Viet Real Estate and Housing Development Company Limited) and opened a representative office in Hanoi, giving Trung full authority to manage it.

Knowing that the High-Tech Security Development Investment Company Limited (CNC) is a front company of C50 (Department of High-Tech Crime Prevention and Control, General Department of Police), Nam invited Nguyen Van Duong (CNC Chairman) to cooperate in releasing online gambling software and was accepted.

In early April 2015, Duong directed his subordinate Luu Thi Hong (CNC General Director) to sign a contract with Nam to provide software services and technology solutions, and commercially exploit a card game under the name RikVip.

After signing the contract with CNC company, Nam directed Phan Anh Tuan (VTC Online Deputy Director of Technology) to buy equipment and sign a contract to rent a server location in Cau Giay district. Tuan and the technical staff of VTC Online company then set up a system of 262 computers for the RikVip card game to operate.

In mid-April 2015, Hoang Thanh Trung completed the software and started organizing online gambling.

From April 19, 2015 to August 29, 2017, a total of nearly 43 million game accounts were registered. On August 9, 2016, there were more than 18 million game accounts with real players, of which nearly 300,000 accounts had phone numbers attached. 500 of these accounts had Rik betting at one time from 6 million (equivalent to 5 million VND).

Authorities believe that the total amount of money deposited into the Rikvip, 23Zdo, and Zon/Pen card game systems operated by Nguyen Van Duong and his accomplices is nearly VND10,000 billion. This figure is incomplete because there is no data from June 24, 2017 to the end date of August 29, 2018.

Of the 10,000 billion, gambling money using telecommunication cards and game cards was 8,800 billion VND. After deducting investment and operating costs, the line received 4,700 billion VND. Of which, defendant Phan Sao Nam received nearly 1,500 billion VND, Nguyen Van Duong pocketed more than 1,650 billion VND, and the group of Phan Anh Tuan, Hoang Thanh Trung and Le Van Kien (currently on the run) received more than 1,570 billion VND.

Bao Ha - Pham Du