Vietnam releases former Jetstar chief executive

by dpa
01 Oct, 2010

Hanoi - Vietnamese authorities have released the former chief executive of low-cost carrier Jetstar Pacific Airlines, a senior police official said Friday.

Major General Hoang Kong Tu, the head of the Security Investigating Agency, said Luong Hoai Nam, 47, was released on bail, but was under house arrest.

Nam was arrested in January on charges of "neglecting responsibilities so as to cause serious damage to state property.

" He was accused of costing the majority state-owned budget carrier millions of dollars by approving a fuel-purchasing contract in 2008, at a time when oil prices had hit 145 dollars per barrel. The price of oil subsequently fell as low as 30 dollars per barrel.

According to government auditors, Jetstar has not earned a profit since its establishment in 1991. In 2008, it booked record losses of 34 million dollars, including 31 million dollars relating to the fuel purchases. It remains unclear when a trial against Nam would take place, Tu said.

Jetstar Pacific has undergone a number of corporate restructurings in recent years. The State Capital Investment Corp of Vietnam now holds 70 per cent of the company.

The remainder is held by Australia's Qantas Airlines (27 per cent) and the state-owned Saigon Tourist Holding Co (3 per cent).