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  • Compliance & Business Integrity
  • 06-02-2020

Criminal prosecution of directors or employees of a company with which the Public Prosecution Service agrees a high-value out-of-court settlement ('hoge transactie') is only successful in a small number of cases, and penalties are almost always lower than prosecutors demand.

Since 2008, 22 out-of-court settlements in the area of financial and economic fraud have been published on the website of the Dutch Public Prosecution Service, with amounts varying from EUR 50,000 for falsification of documents to USD 965,000,000 for bribery of a public official and falsification of documents.

Some conclusions:

  • “Natural persons” (i.e. individuals) are more frequently not prosecuted than prosecuted. Only about a third of cases are prosecuted.
  • In total, only four of the nineteen individuals prosecuted were actually convicted.
  • In all four of those cases, the penalty imposed was lower than demanded by the prosecution.
  • The Prosecution Service mainly prosecutes if the individual concerned has clearly acted out of self-interest.
  • The Prosecution Service only seems to prosecute individuals who hold Dutch nationality.
  • Executive directors are more likely to be prosecuted than employees and supervisory directors of a company. An exception to this are accountants, whom the Prosecution Service is more likely to prosecute.
  • If internal disciplinary measures have been imposed on an individual, or if that person is no longer employed, it seems that the Prosecution Service is less likely to prosecute them.

However, these conclusions concern only a relatively small number of cases that may be complex and a number of which are still open to appeal. Even so, the Prosecution Service must be well aware that these individuals are often not convicted. Of course, being prosecuted in a criminal case is a very drastic experience for an individual and prosecution is not a matter to be dealt with lightly.

You can find an overview of cases here (available in Dutch only).

Financial and economic fraud

For the purposes of the overview, “financial and economic fraud” refers to the offences of bribery of a public official ('ambtelijke omkoping') (Section 177 of the Dutch Criminal Code, “WvS”), bribery of a person other than a public official ('niet-ambtelijke omkoping') (Section 328ter WvS), falsification of documents ('valsheid in geschrift') (Section 225 WvS), fraudulent abstraction of property ('boedelonttrekking') (Section 341 WvS), money laundering (Sections 420bis–420quinquies WvS), and offences under the General State Taxes Act ('Algemene wet inzake rijksbelastingen'), the Trust Offices (Supervision) Act ('Wet toezicht trustkantoren'), and the Money Laundering and Terrorist Financing (Prevention) Act ('Wet ter voorkoming van witwassen en financieren van terrorisme').

Individuals associated with the legal entity

Individuals associated with legal entities that have agreed an out-of-court settlement are included in the overview. These are, for example, directors or employees of the legal entities with which the out-of-court settlement has been agreed. A public official who has been bribed by an employee of a legal entity that has agreed an out-of-court settlement is not therefore included in the overview but the employee concerned is included.

Dutch legal entities

The overview shows high-value out-of-court settlements with Dutch legal entities. In the case of such settlements by the Prosecution Service with international legal entities – which Prosecution Service press releases show are uncommon – no individuals have yet been prosecuted, probably because of a lack of jurisdiction. Dutch subsidiaries of international legal entities that have entered into an out-of-court settlement are however listed in the overview.

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