Combating Financing of Terrorism in Netherlands: Good Results but Room for Improvement
Introduction
The Netherlands has been making progress in combating money laundering and terrorism financing, but experts say there is still more work to be done. In this article, we will explore the country’s efforts and identify areas where improvement is needed.
Money Laundering Risks in the Netherlands
According to a recent report, the Netherlands’ main money laundering risks stem from:
- Fraud: accounting for 90% of all Dutch proceeds of crime
- Drug-related offenses: contributing to the country’s money laundering risks
The Netherlands also faces terrorist financing risks from:
- Religious extremism: including ISIL and other UN-designated groups
- Extreme right-wing terrorism
Risk-Based Policies and Strategies
The Netherlands has developed robust risk-based policies and strategies to address these risks, but it still needs to address outstanding technical deficiencies, including the regulation of virtual asset service providers.
Domestic Inter-Agency Coordination and Public-Private Partnerships
Domestic inter-agency coordination and public-private partnerships are key features of the Dutch anti-money laundering and countering terrorist financing system, with strong cooperation between:
- Financial Intelligence Unit (FIU-NL): providing financial intelligence to support law enforcement agencies
- Law Enforcement Agencies: working together to investigate and prosecute money laundering and terrorist financing cases
International Cooperation
The Netherlands is also effective in cooperating with its international partners, but it needs to increase resources to improve risk-based supervision, including addressing unlicensed activity and ensuring proportionate and dissuasive sanctions for non-compliance.
Confiscating Criminal Assets
The Netherlands has made significant progress in confiscating criminal assets as a strategic priority, but it must do more to prevent legal persons from being used for criminal purposes and ensure access to adequate, accurate and current beneficial ownership information.
Detecting, Investigating and Prosecuting Terrorist Financing Cases
The country has successfully detected, investigated and prosecuted terrorist financing cases, primarily involving the funding of foreign terrorist fighters. The Netherlands also proactively engages with the non-profit sector to avoid their abuse for terrorist financing and prevent de-risking.
Challenges Ahead
However, authorities should focus more on reporting and supervising the timely implementation of targeted financial sanctions for terrorist financing or proliferation financing.
Conclusion
While the Netherlands has made progress in combating money laundering and terrorism financing, there is still room for improvement. The country must continue to strengthen its risk-based supervision, prevent legal persons from being used for criminal purposes, and ensure sanctions are proportionate and dissuasive.