Jewelry shops in Ho Chi Minh City, for long the major foreign-currency source in the City, are sticking to gold trading.
At 4 pm Tuesday, the jewelry market at 178-180 Le Thanh Ton Street, Ho Chi Minh City, was closed with a board announcing it was a “holiday.”
Many people stopped by though the doors were closed and the lights turned off, looking surprised because the place usually remains opens until after 7 pm.
Other jewelers nearby refused to sell customers US dollars.
Tuan, a resident of District 1, said he often trades dollars at jewelry shops at the center but could not reach any of them on the phone that afternoon. He went there and realized that many jewelry shops in the vicinity had become just that and were no longer trading dollars.
An employee of a jewelry shop said since authorities have been cracking down on foreign exchange trading for the last few days, jewelry shops dare not transact dollars publicly any longer.
To avoid the authorities’ gaze, many jewelry shops on the western side of Ben Thanh Market traded the greenback secretly.
Penalizing illegal trade
Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s HCM City branch, said people have the right to possess foreign currencies but are only allowed to sell them to banks and moneychangers licensed by the central bank.
In HCMC, there are 75 moneychangers, mainly in deluxe hotels, supermarkets, airline ticketing offices, the airport, and shopping centers.
A few jewelry shops are licensed too but only to buy foreign currencies and not sell them.
The SBV, in coordination with the police, is cracking down on illegal trading and has said inspections will be carried out every two or three weeks instead of every month unlike earlier.
Penalties will also be harsher. Besides a fine of VND57.5 million (over US$2,700), offenders may also have their license revoked and prosecuted if they are caught carrying out a transaction of above VND100 million.
Minh said the central bank has also asked for permission to seize foreign currencies used in illegal transactions.
So far this year central bank officials have caught nine jewelry shops in HCMC illegally trading foreign money and slapped a fine of VND517.5 million on them.
The city Market Management Bureau fined a computer shop in Thu Duc District’s Linh Trung Ward VND25 million for listing prices in dollars.
Minh said people can buy dollars at banks if they present documents showing they are going abroad for travel, education, medical treatment, and other legitimate reasons. On the other hand, anyone can sell the greenback to banks.
He admitted, however, that many people with a legitimate demand for foreign currencies can hardly buy them at banks.
Most people, Minh said, are hoarding dollars and not selling them to banks because of the lower price compared with the free market. Past inspection campaigns were unable to completely stop illegal forex trading, he said.