Supermarket chain Jumbo wants to draw up stricter internal rules after CEO Frits van Eerd has been discredited due to involvement in a major money laundering case. The tightened “processes and procedures” must “prevent the chance of recurrence”, said acting CEO Ton van Veen on Tuesday. Jumbo thus responds to “a number of vulnerabilities” that emerged from an independent investigation.
Van Eerd was arrested with eight others in September on suspicion of involvement in large-scale money laundering. This would have happened through sponsorship contracts in motor sports, real estate and car dealings and through ‘unexplained cash deposits’. The main suspect is former motocross rider Theo Eggens, an acquaintance of the Jumbo top man who has temporarily stepped down.
Read also: How did Jumbo CEO Frits van Eerd get into the world of shady car dealer Theo Eggens?
Although it was immediately clear that afternoon that Jumbo (10.3 billion euros turnover, 100,000 employees) was in no way involved in the case, the supervisory directors of the family-owned accounting firm decided to ask KPMG to conduct an independent investigation. This revealed “no criminal offenses”, according to Van Veen, but “vulnerabilities”.
For Jumbo, this is a reason to “tighten up internal procedures”, according to Van Veen, who explained the annual figures this Tuesday together with financial director Peter van Erp. “Because as a company we are not involved, but our reputation is. The name of Jumbo is mentioned in the press, so it really touches you. We really learn from that.”
What vulnerabilities did KPMG encounter?
“In his position as CEO, Frits had a certain amount of room to decide independently on matters. You have to see that in the context of a family business, in which he is not only the CEO, but also a co-owner. With today’s knowledge, we should have made that stricter sooner.”
Are you referring to supervision by supervisory directors?
“Not necessarily. You can imagine that when decisions are made elsewhere in the company about sponsorship, for example, not one person makes agreements. A second person must also sign. That was not the case here. Because it involved relatively small amounts for a company with a turnover of 10 billion euros, Frits was allowed to do that independently.”
As delegated supervisory director, you were asked to replace Van Eerd. Did you already get used to that role?
“It was a roller coaster. At the beginning of last year I stepped down from the board and went to the supervisory board, after almost twenty years as a financial chief. In September I was suddenly back. It helps that I know this company well. And that I have a super team around me. We are going through a difficult period as a company, but the fact that we are doing it together also gives us a lot of strength.”
Last month founder Karel van Eerd passed away, Frits’ father and chairman of the supervisory board for many years. The family did not want a period of mourning. Has it been considered internally?
“Certainly. But the funeral took place privately. The family deliberately chose this, because otherwise it would become very massive and impersonal. And the family had already had a few things to choose from last year, so I think this is an understandable choice.”
Suddenly the two most important positions are vacant. What does that mean for control?
“I understand that question, but I cannot answer it. Colette [Cloosterman-Van Eerd, een van Karels twee dochters] is now acting chairman of the supervisory board. So we now have two observers, in crucial positions.
“We have agreed that we want to close the year first, in all respects. The books close, the accountant checks them. Hopefully at the end of February we can then say that 2022 is really ready and that we can look ahead. At that time, the shareholders and supervisory directors will start evaluating, and they will have to consider how those two positions will be filled definitively.”
The current management situation is not sustainable for long?
“It does work in practice, this model. We know each other well, and we get through it well. Our numbers reflect that too. But it is not a model of years. So at some point you have to make a decision. And a lot also depends on the question: will Frits return or not? We cannot anticipate that yet.”
Frits is really outside the company for the time being?
“He has stepped down as CEO and has been deregistered as a director. He himself decided to do that. He is still a shareholder and in that capacity I speak to him on a regular basis. But he is no longer here in the company.”
Can you still make major decisions in so much administrative uncertainty? An acquisition, for example?
Van Erp: “As a company, we have a five-year plan that we stick to. And we will also remain very alert when it comes to acquisitions, to see whether a possible acquisition suits us. We have the financial room for it, we have the confidence of banks. And the family and the supervisory directors have also expressed great confidence. So if such an opportunity arises, we will play a part in it at all times.”
The regional player Jan Linders went to competitor Albert Heijn last month.
Van Erp: “For Albert Heijn, this is a great acquisition. They are less in the south. We are already well represented there. So Jan Linders is a nice formula, but suited us less because we have too much overlap. Of the 63 stores, only a handful would be suitable for us. That is why such a chain does not go to Jumbo.”
But if a chain from another region rings the doorbell…
Van Erp: “Everyone can have our 06 number and call if they want to see if a takeover fits.”