Brian Jeffrey
Rare Earth Smuggling Operation Uncovered in Vietnam
Investigators have revealed that between October and November 2021, Liu Dehua, a freelance trader from China, leased land in Hai Phong to set up a facility for processing rare earth minerals. He managed the acquisition, refinement, and exportation of these valuable resources back to China.
Liu sourced over 2,000 tons of rare earth ore with a concentration of 14-17% from Doan Van Huan, the Chairman of Thai Duong Company. The materials were transported from the Yen Phu mine to Liu’s plant, where they were refined to achieve a concentration of 20-30%.
To mask the true nature of the shipments, Liu told his team to blend the minerals with various chemicals and additives, resulting in a non-transparent white powder. This concoction was then packaged in bags that falsely claimed to contain “Bao Khang Rice – soft, fragrant, and perfectly cooked rice. Net Weight: 50kg” to pose as a food product.
Additionally, Liu brought in Qiu Wei Beng, a Chinese executive and director of Guangzhou Company, to manage the export logistics. The shipments were incorrectly labeled as “Oxalate Compound Mixture” in an effort to bypass customs scrutiny.
Using his Vietnamese associate, Leng Kai (also known as Tony Leng), who is the Director of WidelyStar Logistics Vietnam, Bung coordinated with Tran Duc, who leads Duong Lieu Company, for export documentation.
Bung assured Leng Kai that the items were legal and locally sourced, prompting Duc to agree to process the shipments without demanding further verification.
Duc rented a warehouse located in Hai An District, Hai Phong, referred to as DDC Dong Hai Warehouse, for the operation. His staff member, Tran Nhu Hoang, oversaw the shipments. Leng Kai shared the warehouse information with Bung, who conveyed it to Vu Thi Tuyet, an employee of Liu in Hai Phong.
As shipments were prepared, Bung would provide the necessary shipping documents to WidelyStar Logistics, which were then sent to Duc. Liu directed Tuyet to work with Hoang to move the disguised minerals to the warehouse for packing into containers destined for export from Hai Phong ports.
Due to the absence of valid origin certificates, Duc and Hoang illicitly listed Duong Lieu Company as the official exporter. They created fake commercial invoices and altered customs records, breaching Article 10, Clause 2(a) of Vietnam’s Customs Law No. 54/2014/QH13.
From May 5 to September 2, 2023, Duc filed eight customs declarations at Dinh Vu Customs Branch in Hai Phong, inaccurately labeling the shipments as “Oxalate Compound Mixture”.
The total amount smuggled: 200 tons
Reported export value: Over $500,000
Market value of the actual rare earths: Exceeding $340,000, calculated at $1,700 per ton with a concentration of 14-20%. Liu Dehua fled Vietnam on September 24, 2023, just ahead of impending criminal charges.
Although the case against Liu has been temporarily put on hold, investigators have stated that he will face prosecution once he is apprehended for his significant involvement in this smuggling scheme.
