A representative of the State Bank of Vietnam (SBV) affirmed that virtual gold trading was illegal and warned them of the extremely high risks involved.

Vietnamnet online quoted Nguyen Ngoc Canh, Director of the SBV Foreign Exchange Management Department as saying organisations or individuals who establish a trading floor for gold and buy or sell the precious metal using overseas accounts without permission from Vietnamese authorities were violating Vietnam Law.

According to Decree No 24/2012 /ND-CP on gold business activities, the Prime Minister and the SBV have yet to grant a licence to any organisation or individual for gold business activities, including gold exchange and gold trading using overseas gold accounts.

The SBV has warned people to refrain from joining in gold trading through gold trading floors using overseas gold accounts. Violators will be administratively charged and fined from 50 VND to 100 million VND (2,350 USD to 4,690 USD), and their gold and other paraphernalia will be confiscated.

Canh said that in the near future, the SBV would strengthen inspection procedures and work with concerned agencies for the timely detection and handling of cases of virtual gold trading.

The SBV also warned that organisations or individuals found guilty of virtual gold trading would be required to report regularly to the hi-tech crime police, SBV and concerned agencies.

According to the foreign exchange management department, virtual gold is viewed as speculation and price manipulation that destabilises the country's economy.

Between 2008 and 2009, the operation of gold trading floors in the country created great risks for investors and great losses to society.

As a result, in December 2009, the Government asked the SBV to implement drastic measures to stop all activities related to gold trading floors or gold trading accounts.

Earlier, the police arrested six top officials of the Hanoi–based Khai Thai Consultant Limited Company (KTIC) for "illegal business practices" on October 2.

The arrested officials include KTIC General Director Hsu Ming Jung (also called Saga) from Taiwan, KTIC Director Nguyen Manh Linh and three branch directors, as well as a chief accountant.

The Police Department for Investigation of Social Order Crimes (C45), under the Ministry of Public Security (MPS), has confiscated about 70 billion VND (3.3 million USD) after examining KTIC's branches and Jung's residence in Hanoi.

Investigators from the MPS Hi-tech Criminal Prevention Department (C50) had initially found that KTIC was operating an illegal online gold and foreign exchange (forex) trading floor.

On September 26, C50 arrested the director and chief accountant of VGX Investment Joint Stock Company (VGX) for operating an illegal gold trading floor.-VNA