Chasing Cash to Prove Point

Most foreign banks had abandoned Saigon by the time helicopters airlifted the last evacuee from the roof of the U.S. Embassy in April 1975.

They left behind a largely unnoticed group of victims of the communist victory -- thousands of Vietnamese who were unable to recover money they had deposited in financial institutions such as Chase Manhattan Bank, Citibank and the Bank of Tokyo.

Now, 28 years later, more than 20 of those depositors have filed suit in Los Angeles Superior Court, hoping to reclaim passbook accounts and certificates of deposit that evaporated along with the South Vietnamese regime.

Led by a Vietnamese immigrant with a night school law degree, they are suing five banks, including Chase Manhattan, Citibank parent Citigroup Inc. and Bank of Tokyo-Mitsubishi -- financial Goliaths that have consistently denied any obligation to pay.

Alleging fraud and breach of contract among other things, the lawsuit contends the banks attracted customers to their branches in Vietnam during the war by pledging to honor accounts, no matter what.

Instead, the plaintiffs allege, the banks shut their doors without warning before the communist takeover. Anxious depositors were turned away when they inquired about their accounts in the weeks immediately before and after the fall of Saigon.

“They just said the bank was closed and everyone had left. There were no new bankers,” said Le Dung Thi Nguyen of West Covina, whose late husband is a plaintiff in the suit, which seeks class-action status for all depositors in similar situations.

Her husband, Huan Tran Dang, an author and former journalist for a South Vietnamese military publication, spent eight years in a communist “re-education” camp before immigrating to the United States. He died recently of liver cancer, leaving his 71-year-old widow to press the claim against Chase for $622.25, plus 28 years’ interest.

“He wasn’t pursuing it for the money,” said Thu-Cuc T. “Tracy” Phung, the depositors’ attorney. “But as a journalist he wanted fairness and justice. For the rest of the people, not just himself.”

Dang’s six-month CD with Chase paid 23 1/4% interest, but Phung said a court setting interest at a fair rate in dollars might rule the claim is now worth $3,000 to $4,000. Among other things, the suit seeks an accounting of how many thousands of similar small accounts were at the banks -- and exactly what happened to the money.

The suit is one in a series of similar claims pursued by Phung, whose offices are located above a tea and ginseng shop in Orange County’s Little Saigon, home to more ethnic Vietnamese residents and businesses than any place outside Vietnam.

Phung, who took law classes at night from National University in San Diego while raising four children, was successful in her first attempt, winning a $2-million payment from Royal Dutch/Shell for nearly 600 Vietnamese workers who lost their jobs without severance pay when the oil company’s Vietnam operations were taken over by the communist government. Shell said it felt a moral, though not legal, obligation to pay.

But other cases brought by Phung, who has returned to Vietnam 16 times in the course of her work, have been stymied in the courts or rejected outright.

Just this month, lawsuits on behalf of former Vietnamese employees of the U.S. government were thrown out of the U.S. Court of Federal Claims in Washington. Edward J. Damich, the court’s chief judge, said the suits had been brought too late, forcing him “regrettably” to grant the U.S. government’s dismissal motion despite “tremendous sympathy for the plight of these plaintiffs.”

Damich called the case “one more aspect of the unfortunate predicament of an untold number of Vietnamese nationals who were working in Vietnam for various agencies of the United States at the time the United States government abandoned the country at the end of the Vietnam war.”

The bank depositors named in the suit -- Vietnamese natives who now live in Orange and Los Angeles counties, except for one in Georgia and one in Ho Chi Minh City, the former Saigon -- approached Phung after hearing about her other cases.

Their suit against the banks, filed in April, faces significant legal hurdles. In addition to asserting that statutes of limitations have passed, the banks have argued that their legal obligation to depositors was wiped out by the communists’ takeover of their operations in Vietnam.

“We didn’t willingly close the branch,” said Paul Marriage, a spokesman for Standard Chartered Bank in London, one of the defendants. “We were taken over lock, stock and barrel in 1975 by the government, and we lost all the assets. And although we reopened in 1990, none of the assets or customer records ever were returned.”

Added Bob Hand, general counsel for Bank of Tokyo-Mitsubishi’s U.S. operations: “My sense is that it will be a real challenge just to establish what the facts are after all the time has passed.”

Officials at Chase Manhattan, the bank mentioned by name most often in the 18-page complaint, declined to comment. But in letters to former depositors, including the now-deceased Dang, the bank has made clear its position.

Dang sent a written claim to Chase on Jan. 1, 1993, shortly after his family finally was able to immigrate to Southern California with help from the U.S. government and a Roman Catholic organization.

A week later, Chase sent back a form letter saying the government-owned central bank of Vietnam “is operating the banking business formerly conducted by private banks.” In addition, the letter cited a New York federal court ruling that claims for funds in Chase’s Saigon branch must have been made within six years of when it closed.

Attorneys for the depositors maintain that there’s no evidence the current government of Vietnam ever assumed the liabilities of any foreign bank. They also say statute of limitations arguments don’t apply in the California courts, citing a section of the state’s Code of Civil Procedure that places no time limit on actions to recover deposits in solvent banks.

Similar cases involving claims against New York-based Chase and Citibank, filed before statute of limitations issues arose, were decided in the 1980s. In one federal court decision that was upheld on appeal, Citibank’s home office was found liable under Vietnamese law for a deposit of about $1,400 in Vietnamese currency at Citibank Saigon.

However, Hal S. Scott, director of the International Financial Systems Program at Harvard Law School, said other federal appeals courts have held that under New York state law, the banks had no obligation to repay the depositors once they established that their operations had been expropriated.

“It’s a very unsettled situation legally,” Scott said. “There will be questions of what law to apply -- Vietnamese law at the time? California law? New York law? The banks will try to have the case heard using New York state law in federal court,” where the statute of limitations would come into play.

Scott, who expressed surprise that the suit had been filed so long after the fact, said the depositors’ best shot at winning would be to prove the banks promised to stand behind the accounts regardless of what happened in Vietnam. The banks also may be held liable if it can be shown that they neglected a duty to the account holders, he said.

The plaintiffs said one reason they didn’t take action until now is because their individual claims are so small; the largest account described in the lawsuit is $5,690.48. And many of the depositors lost their homes and jobs and wound up in relocation or prison camps after the war.

Moreover, most lacked the English language skills, familiarity with the U.S. legal system and money to hire lawyers, said attorney Kent Henderson of Santa Ana. Henderson’s firm is co-counsel to the depositors along with Phung’s office.

Linda Trinh Vo, an assistant professor of Asian American studies at UC Irvine who has studied the social adaptation of Vietnamese immigrants, said the suit’s timing makes sense.

South Vietnamese who fled to the United States as adults, not wanting to seem ungrateful to the country that provided refuge, have been reluctant to do anything that could reflect badly on the U.S. or its institutions, she said. Only recently have their U.S.-educated offspring moved into the American mainstream by standing for local political offices and, now, asserting their claims in the class-action suit.

“They kind of have a sense that in some ways they have paid their debt,” Vo said. “And now we can start to address some of the things that went wrong.”