Financial Crime World

Title: Netherlands’ Financial Regulators Crack Down: AFM and DNB Wield Enforcement Power

Dutch Financial Regulatory Scene: A Busy Landscape

The Dutch financial regulatory landscape is vibrant with activity as the Autoriteit Financieel Markten (AFM) and De Nederlandsche Bank (DNB) enforce compliance with financial laws and regulations [1]. Both entities possess the power to take both informal and formal actions against legal entities and individuals who breach financial rules.

Informal Measures: Quiet, Yet Powerful

Informal measures are a crucial component of maintaining order within the Dutch financial sector [2]. Despite lacking legal basis, these measures have proven effective. Some examples of informal measures include:

  • Oral compliance briefings
  • Written compliance briefings
  • Written warnings

While these methods do not have the same legal weight as formal administrative sanctions, they serve as a potent deterrent to potential rule-breakers.

Formal enforcement measures, also known as administrative sanctions, carry legal backing and can range from remedial actions to punitive measures [2]. Some examples of formal enforcement measures include:

  • Imposing an order subject to penalty
  • Appointing a caretaker
  • Suspending voting rights
  • Imposing a prohibition
  • Restricting or revoking a license

Transparency: Disclosure of Enforcement Actions

Under Dutch financial laws and regulations, regulators are required to disclose their decisions to impose administrative sanctions, providing transparency into the enforcement process [3]. These disclosures typically occur once the sanction is irrevocable, meaning all legal remedies have been exhausted. At this point, the public is granted access to the details of the decision and the imposed penalty.

A Recent Case: Black Swan Capital Faces the Consequences

Just recently, DNB imposed a €15,810 administrative fine on investment firm Black Swan Capital B.V. (BSC) for failing to maintain sufficient own funds between the end of 2019 and 21 July 2023 (30 May 2024) [1].

[1]: Source: DNB Press Release, 21 May 2024. [2]: Financieel Dagblad [3]: Wet op de financiële markten (Wet FM) en de besluiten en richtlijnen die daarop zijn gebaseerd.