The Netherlands must be stricter with regard to financial institutions and other sectors that play a role in preventing money laundering and terrorist financing. That writes an international watchdog in a report that Minister of Finance Sigrid Kaag sent to the House of Representatives. The Netherlands must also see whether supervision can be tightened up and whether stricter penalties should be imposed for money laundering.
The Financial Action Task Force (FATF) writes in a report that the Netherlands generally achieves good results when it comes to combating money laundering and terrorist financing. Yet it is still too easy to set up constructions with companies or other legal entities that are used for criminal purposes. Supervision in itself is competent, but sometimes too non-committal and based too much on informal agreements and warnings. The penalties for money laundering are also so low that criminals are not deterred by this.
One of the problems is that it is not always clear who ultimately has an interest in a certain construction with companies, foundations or other organizations. Actually, that information about the so-called ‘ultimate beneficial owner’ (UBO) should be recorded in a register at the Chamber of Commerce, but when the FATF came to the Netherlands, it turned out that only 27 percent had done so. There are hardly any penalties for this. According to the FATF, no company has ever been caught passing on false data.
The supervisor believes that notaries in particular can get away with accepting the defective UBO data in the Netherlands too easily. The government should force them to put more effort into verifying that the data is correct. If their clients have devised constructions that are so complicated that there is a risk that they will be used for money laundering or terrorist financing, the civil-law notaries should just refuse that client.
Minister Kaag says that she, together with Minister of Justice Dilan Yeşilgöz, will only respond to the FATF report after the summer.
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