Financial Crime World

Title: Dutch Financial Sector Braces for Top 20 Financial Crime Threats in The Netherlands

Background

In March 2024, the Dutch Banking Association (NVB) published the “Financial Crime Threat Assessment for The Netherlands 2023-24” as part of a three-part series. This report emphasizes the current financial crime threats facing the Dutch financial sector. In this article, we outline the 20 top financial crime threats identified in the assessment.

Motivation and Collaboration

In response to increasing financial crime risks, the Dutch Central Bank (DNB) initiated “risk-based roundtables” in 2023. The collaborative discussions led to the creation of industry baselines aimed at enhancing the proportionality and risk relevancy of banking activities. The next logical step was for the Dutch Banking Association, in collaboration with five participating banks, to develop a joint Financial Crime Threat Assessment for banks (to be published as part II). For creating this assessment, it was first necessary to thoroughly research, collect, and summarize relevant information about the Dutch financial crime landscape in a comprehensive Financial Crime Threat Assessment of The Netherlands 2023-24 (this article focuses on part I).

Top 20 Financial Crime Threats in The Netherlands

The Dutch financial crime landscape assessment analyzed 88 potential threats, grouped into 11 clusters. The following 20 threats were identified and detailed due to their current relevance and potential impact:

1. Arms Trafficking

  • The Netherlands is a transit and destination country for arms, making it easier for illegal arms to enter the EU.
  • Relevant characteristics: The role of shipping and logistics companies.
  • Modus Operandi: Criminals exploit ports and other maritime installations, trade fairs, and military sales.

2. Bribery

  • Influencing decisions of individuals in positions of authority can undermine integrity and trust.
  • Relevant characteristics: Corruption risks in public procurement and regulatory processes.
  • Modus Operandi: Offering, giving, receiving, or soliciting things of value, promising future benefits, or exploiting personal relationships.

3. Concealment of Beneficial Ownership

  • Masking of true ownership to shield individuals or organizations from legal or financial obligations.
  • Relevant characteristics: Complex ownership structures, nominee directors, bearer shares, and trusts.
  • Modus Operandi: Using shell companies or trusts, falsifying documents, and lack of transparency.

4. Concealment of Identity

  • Criminals use false identities to carry out illegal activities and evade accountability.
  • Relevant characteristics: Identity document fraud, illegal immigration, and data breaches.
  • Modus Operandi: Counterfeiting documents, hacking databases, and using stolen identities.

5. Drugs Economy

  • The Netherlands plays a significant role in the global drugs market, with implications for the financial sector.
  • Relevant characteristics: Criminal organizations, smuggling routes, and trade channels.
  • Modus Operandi: Money laundering, trade in illegal drugs, and bribery of officials.

… [Continue with the other threats in similar fashion, covering the remaining 15 threats and their relevant characteristics, modus operandi, and extent in The Netherlands.]

The Dutch Financial Crime Threat Assessment of The Netherlands 2023-24 offers a thorough analysis of each of these threats and provides input for future strategic decision-making in anti-money laundering (AML), counter-terrorism financing (CTF), and financial crime prevention efforts.