Explosive chemicals and fake military contracts: wealthy business owners lose millions of dollars in alleged scam

Ohnmar Phyu and her husband Tin Win grew increasingly uneasy as they sat waiting in the lobby of CB Bank’s headquarters in downtown Yangon one February morning last year.

Just days earlier the pair, who own a jewellery business, had given almost six billion kyats, roughly four million US dollars, to help a borrower repay an installment on a loan.

After re-paying the installment, the borrower would then be able to loan more money from the bank, and would use this to pay the couple back with interest.

Or at least that’s what they had been told by the woman who took their money, a friend they had known for 15 years named Thuzar Myint Htun, who claimed to be acting as the broker.

After handing over the money, the couple learned that their friend was facing some financial problems, so they arranged to meet with her and the bank’s loans officer, hoping to be reassured that they would get their money back.

But as the minutes turned into hours it became obvious Thuzar Myint Htun wasn’t going to show.

Eventually, the loans officer arrived with bad news: the bank had no idea about the deal they had made with their friend, and wouldn’t be taking any responsibility for it.

Ohnmar Phyu and Tin Win, it seemed, had been duped, and they weren’t the only ones.

Over the next few days it emerged that Thuzar Myint Htun had allegedly scammed her wealthy contacts out of more than 20 billion kyat, roughly $13 million.

The alleged victims included business people and former civilian and military officials.

But for now Tin Win, a retired customs official, was still hoping that there had been some kind of mistake.

He called Thuzar Myint Htun and put her on the phone to the loans officer to clear things up.

But the loans officer, Soe Soe Thin, gave the phone back almost immediately, explaining that whatever the problem was, it had nothing to do with the bank.

“Just try to settle it with her,” she told the couple.

Tin Win left the bank and headed for Thuzar Myint Htun’s home, a luxury waterfront villa in Yangon’s Thingangyun township.

Ohnmar Phyu waited behind in the lobby, where for the last couple of hours a woman in a bright red blouse had also been waiting, just like them.

A chance meeting at the villa

Thuzar Myint Htun did not appear to be home when Tin Win reached the Mya Yamon Waterfront Villa, a complex beside Pazundaung creek of over 100 homes worth up to 1.2 billion kyats. So he waited.

Not long after Tin Win’s arrival, a car pulled up, and the lady in the red blouse from the bank lobby got out.

Her name was San San Win, and she was also looking for Thuzar Myint Htun after handing her seven billion kyat for a similar deal.

They tried in vain to reach Thuzar Myint Htun by phone. Then a couple of hours later, more people showed up.

This time it was a group of three Shan-Chinese business people, led by a woman named Yan Yone Li, who had invested 900 million kyat into the loan scheme.    

Thuzar Myint Htun never showed, and a few days later Yan Yone Li and San San Win opened a case against her at the local police station.

She was arrested and charged under section 420 of the penal code for cheating, and section 468 for forgery with the intention of cheating.

If found guilty on both charges she faces up to 14 years in prison. Judges have denied her requests for bail.

San San Win, the lady in the red blouse, pressed charges against Thuzar Myint Htun for forging documents in a separate deal.

The Voice, a local news outlet, AS reported in March last year that Thuzar Myint Htun was charged with forging a land ownership document to give the impression she owned a property worth 1.4 billion kyats. San San Win agreed to buy that property from her, and paid 1.3 billion kyats towards the sale.  

She was among nine people who say they lost money to Thuzar Myint Htun in a complaint letter sent to the President’s office in November last year.

The letter does not address the 1.3 billion kyat property deal, and instead focuses on the CB Bank case and another alleged scam involving a fake contract to supply explosive chemicals to the military.

In the letter, San San Win and others wrote that they were “very concerned about corruption in the court and justice system,” adding that they feared Thuzar Myint Htun “might use the money she got dishonestly from us to pay bribes to weaken the case or make it go away.”

The complaint letter was signed by San San Win, Ohnmar Phyu, Ei Myat Sandi, Aye Yadanar Myint, Zay Lat Win, Htet Ko Ko, Yan Yone Li, Aung Myo Htun and Zaw Moe Win.

It is believed that, although they are not named in the letter, family members of top military and civilian officials and even celebrities also lost money in the scheme.   

The Bureau of Special Investigations is still investigating the case, while the military reportedly concluded an internal investigation into parts of Thuzar Myint Htun’s conduct last year.  

‘Forged documents’

Yan Yone Li, who moved to Yangon from Lashio 10 years ago, was introduced to Thuzar Myint Htun by a friend in early 2018.

Not long after, Thuzar Myint Htun offered her the opportunity to make a quick three percent profit on a loan of nine billion kyat.

She showed Yan Yone Li letters from CB Bank which confirmed the loan had been made and that the bank was demanding the borrower repay 30 percent of the principle.

Yan Yone Li sent over the money, but when she tried a few days later to cash the cheque to reclaim it, the bank said the chequing account had nothing in it.  

A CB Bank spokesperson told Myanmar Now that the letters Thuzar Myint Htun showed to Yan Yone Li were fake.

In their letter to the president, the alleged victims of the CB Bank loan scam claimed that the bank itself was complicit.

Yan Yone Li and San San Win said they gave Thuzar Myint Htun their money only after getting approval from the loans officer at CB Bank.

Soe Soe Thin, CB bank’s loans officer, strongly denied this.

All she did was to confirm that the bank does indeed offer loans and that Thuzar Myint Htun was one of their customers, she told Myanmar Now.

She did not sanction any deal that involved lending money to a borrower to help them repay a portion of their loan, she said, but merely explained what was written in leaflets that the bank gives to loan applicants.

“I only answered their questions according to the bank’s rules and regulations. They are just trying to include the bank in the scandal [to try to get back the] money they lost,” Soe Soe Thin said.

CB Bank’s chief compliance officer, U Oo Thein Myint, said the Bureau of Special Investigations, the military, the police and the Criminal Investigation Department had all questioned the bank and concluded that it did nothing wrong.  

Explosive chemicals

In late 2017 Khine Sandar Lwin, a wealthy businesswoman with interests in gems and property, met with Thuzar Myint Htun at a restaurant to discuss a deal to import batches of an explosive chemical for the military.

Thuzar Myint Htun brought along her brother, a lieutenant colonel named Maung Bo who at the time was serving as a military MP, as well as a representative from a Taiwanese chemicals supplier.

Thuzar Myint Htun said that the military was calling for tenders to supply it with ammonium nitrate and that Zay Man Taing, a company for which she was on the board of directors, had a good chance of winning the contract.

Khine Sandar Lwin’s role would be to bankroll the purchase of the chemicals, and in return she would get the money back with interest.

Like others who said they were cheated, she had successfully done business with Thuzar Myint Htun in the past. And the presence of a senior military official at the meeting made her even more confident about the deal, she told Myanmar Now.

When she heard Zay Man Taing had won the contract, she sent 1.3 billion kyat to the company’s account. But then Thuzar Myint Htun asked for more money.

This time it was 2.1 billion, which she said was needed urgently to pay a deposit to the office of the commander-in-chief to secure the contract.

Thuzar Myint Htun would be able to pay her back for this second sum in just a couple of days, she said. But when Khine Sandar Lwin took her cheque to the bank, she was told, like Yan Yone Li, that the chequing account had no money in it.

Growing angry, she called Thuzar Myint Htun to her house and demanded the money back. But thuzar Myint Htun responded that she didn’t have it.

Instead, she signed an agreement saying she would pay it back in six months.

Then she left Khine Sandar Lwin’s house in such a hurry that she forgot to bring her phone with her. A few days later, it started ringing.

When Khine Sandar Lwin answered, she discovered she was not the only one who had sunk money into the ammonium nitrate scheme.

The man on the end of the phone was Aung Myo Tun, a former naval officer and a longtime friend of Thuzar Myint Htun.

He had sent her eight billion kyat, a sum that included money from his family and colleagues at the Myanmar Economic Bank in Lashio, where he works as an assistant manager.  

Like Khine Sandar Lwin, he had trusted Thuzar Myint Htun because he had made reliable profits on his previous investments with her. What’s more, he and her brother Maung Bo attended military training school together.

But after the chance phone call Aung Myo Tun knew something was wrong, so he sent a letter to the commander-in-chief, Senior General Min Aung Hlaing, to ask if the contract for ammonium nitrite did indeed exist.

“The senior general read the letter on Monday, and gave orders on Tuesday,” Aung Myo Tun said.

Military investigation

After receiving his letter, the military launched an internal investigation headed by a brigadier general, he added. Months later, high-ranking officials told him that Thuzar Myint Htun’s story about the call for tender was false, he said.

The military said it had no plans to take legal action but that its officers would appear in court as witnesses if the complainants wished to press charges.

Military investigators also said that lieutenant colonel Maung Bo was transferred to another position because he acted outside of his authority, according to Khine Sandar Lwin’s daughter, Ei Myat Sandi.

But the investigators stressed to her that he was not involved in any scam, she said.

It is unclear if Maung Bo is still serving in the military or was transferred to a civilian position. Myanmar Now was unable to reach him for comment.

Maung Bo was removed from his position as a military MP on May 15, 2018. No reason was given for his replacement, as is standard military practice, but Aung Myo Tun speculated that it was a result of his complaint.

“I would have complained to the speaker of the pyithu hluttaw if the military hadn’t investigated,” he said.

Brigadier General Zaw Min Tun of the military’s True News Information Team said he was not aware of the scandal when contacted by Myanmar Now.

At a court hearing in Thingangyun township in January, Thuzar Myint Htun was briskly escorted in handcuffs from a small room with wire caged windows to the courtroom.

The hearing lasted less than 10 minutes, and Myanmar Now was unable to get comment from the defendant or her lawyer as she was whisked away.

After the hearing she was sent back to Insein prison, a far cry from the waterfront villa where she used to enjoy her wealth.

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