According to investigation findings, from October to November 2021, Liu Dehua, a Chinese national and freelance trader, rented land in Hai Phong to establish a rare earth processing plant. He directed the purchasing, processing, and exporting of high-value rare earth minerals to China.

Liu acquired over 2,000 tons of rare earth ore, with a 14-17% concentration, from Doan Van Huan, Chairman of Thai Duong Company. The ore was transported from the Yen Phu mine to Liu’s processing facilities in Hai Phong, where it was refined to increase its concentration to 20-30%.

To disguise the rare earth shipments, Liu instructed employees to mix the minerals with chemicals and additives, creating an opaque white powder. The mixture was then packed in bags labeled “Bao Khang Rice, just like mom's cooking - soft, fragrant, and perfectly cooked rice. Net Weight: 50kg”, falsely branding the shipments as food products.

A well-coordinated smuggling operation

Liu enlisted Qiu Wei Beng, a Chinese national and Director of Guangzhou Company (based in China), to handle export procedures. The shipments were falsely declared as "Oxalate Compound Mixture" to evade detection.

Through his Vietnamese associate, Leng Kai (Tony Leng), Director of WidelyStar Logistics Vietnam, Bung coordinated with Tran Duc, Director of Duong Lieu Company, to handle the export paperwork.

Bung assured Leng Kai that the goods were not prohibited and originated from Vietnam. Without requesting additional documentation, Duc agreed to process the shipments.

To facilitate the operation, Duc rented a warehouse in Hai An District, Hai Phong (DDC Dong Hai Warehouse). His employee, Tran Nhu Hoang, managed the shipments. Leng Kai then relayed the warehouse details to Bung, who passed them to Liu’s employee, Vu Thi Tuyet, in Hai Phong.

Smuggling logistics and customs fraud

Whenever a shipment was ready, Bung provided shipping documents to WidelyStar Logistics, which then forwarded them to Duc. Meanwhile, Liu directed Tuyet to coordinate with Hoang to transport the disguised rare earths to the warehouse, where they were packed into containers for export via Hai Phong ports.

Since the shipments lacked proper origin certificates, Duc and Hoang fraudulently declared Duong Lieu Company as the official exporter. They fabricated commercial invoices and falsified customs records, violating Article 10, Clause 2(a) of Vietnam’s Customs Law No. 54/2014/QH13.

Between May 5 and September 2, 2023, Duc processed eight customs declarations at Dinh Vu Customs Branch (Hai Phong), falsely labeling the exports as “Oxalate Compound Mixture”.

Total smuggled quantity: 200 tons
Declared export value: Over $500,000

Actual rare earth market value: Over $340,000, based on the price of $1,700 per ton at a 14-20% concentration.
Liu Dehua fled Vietnam on September 24, 2023, shortly before authorities initiated criminal proceedings.

Vietnamese investigators have temporarily suspended the case against Liu. However, the authorities have confirmed that once captured, he will face prosecution for his role in the large-scale smuggling operation.

T. Nhung