Former vice chairman of Hanoi faces mismanagement charges over ruptured water pipeline

Phuong Son - May 23, 2017 | 06:51 AM GMT+7

Investigators reversed their decision not to charge seven execs following public outcry.

Former vice chairman of Hanoi faces mismanagement charges over ruptured water pipeline
Ruptured water pipeline. Photo: Traffic newspaper

The Ministry of Public Security's Police Investigation Agency on Monday ratified charges against Phi Thai Binh, former vice chairman of Hanoi, for mismanagement during his time as chairman of Vinaconex Corporation's board of directors.

Vinaconex is the state-owned construction company responsible for the Song Da water pipeline, which has infamously ruptured more than a dozen times in the last few years.

Former CEO of Vinaconex Nguyen Van Tuan and five other executives also face charges for violating construction and investment regulations.

All seven have been released from custody due to old age and poor health, and having fully cooperated with investigators.

An investigation in July 2016 found that Vinaconex had hired a Chinese contractor to build the pipeline. Construction started in 2004 and the pipeline was finished and put into use in 2009.

However, between 2012 and 2015, the pipeline ruptured 14 times, costing the operating company more than VND13 billion ($573,000) in repairs.

The ruptures caused 177,000 houses to lose access to clean water for nearly 350 hours and wasted 1.5 million cubic meters (400 million gallons) of water.

The investigation revealed that members of the corporation's board of directors, including Chairman Binh and CEO Tuan, allegedly violated construction and investment regulations by changing the construction material to low-quality, untested fiberglass composite and selecting a contractor that lacked the necessary ability and experience for the project. Low-quality fiberglass that failed to meet the design requirements was cited as the main reason behind the ruptures.

Investigators initially decided not to prosecute the executives because they were first time offenders with good personal records and had contributed to the construction industry. However, following a public backlash, they reversed the decision.

In June 2016, nine other officials were also charged with violation of construction and investment regulations, including members of the project's management team, consultants and the company that provided the fiberglass.

Last week, Hanoi's construction department warned that it will be "hard" to deliver enough tap water to four downtown districts as demand increases over the hot summer. The situation could become much worse if the notorious Song Da pipeline ruptures again.

The Song Da water pipeline, which cost $70 million to install, has broken at least 20 times since 2009, most recently in October last year.

Vinaconex signed a contract to use pipes from another Chinese company to fix the unreliable system but backed out of the deal in August last year after the government raised concerns over quality standards.