Financial Crime World

Dutch Authorities Take Aim at Financial Crime Whistleblowers’ Protections

2023: A Year of Renewed Focus on Financial Crime Whistleblower Protections

In the Netherlands, 2023 was marked by a renewed focus on financial crime whistleblower protections. Several ongoing trends highlighted the importance of addressing this issue.

The Dutch Public Prosecutions Service (DPPS) published a draft instruction on legal privilege in early 2023, sparking debate about whether the DPPS can assess privileged information or if this assessment should only be performed by a judge. The matter was put on hold when the Dutch Supreme Court was asked to issue a preliminary ruling.

Dividend Stripping Under the Spotlight

The practice of dividend stripping has come under scrutiny, with the Dutch tax and criminal authorities announcing their focus on combating the practice. Market participants are invited to come forward with information.

Whistleblowing Complaints: A Growing Trend

Non-Governmental Organizations (NGOs) and special-interest groups have been increasingly active in filing whistleblowing complaints, which can trigger internal or external investigations, reputational damage, litigation, and regulatory scrutiny. In-house legal and investigation teams and General Counsel must ensure that they have adequate policies and procedures to handle such complaints.

Government Priorities

The Dutch government has prioritized combating corruption, fraud, tax evasion, environmental crime, and cybercrime. The financial sector remains a high priority for the Dutch Central Bank (DNB), which is proposing reforms in its approach to Anti-Money Laundering (AML) compliance. New legislation aims to strengthen supervision and regulation of financial institutions.

Key Government Initiatives

  • Combating Corruption: The government is taking steps to combat corruption, including strengthening laws and regulations.
  • Environmental Crime: The Environment and Planning Act came into force on January 1, introducing new duties of care for companies holding permits, including a prohibition on stopping an activity that mitigates adverse environmental effects. Violations can be sanctioned under criminal law too.

Multinational Businesses Under Scrutiny

Multinational businesses will continue to face scrutiny regarding compliance with international sanctions, human rights violations in supply chains, and ensuring adequate whistleblower protections.

Predictions for 2024

  • Increased Focus on Sanctions Breaches: Authorities are likely to increase their focus on prosecuting sanctions breaches.
  • Dividend Stripping: Dividend stripping is expected to remain a priority area of focus for authorities.
  • Environmental Crimes: Environmental crimes are also expected to continue to be a priority area of focus.

In-house legal and investigation teams and General Counsel must be proactive and responsive to stakeholder demands and expectations while anticipating potential legal and reputational risks related to ESG issues such as climate change, human rights, diversity, and inclusion.