Netherlands – Page 4 – European Sanctions Enforcement

October 21, 2024October 21, 2024 by Mark Handley

Netherlands – sanctions compliance fine on trust services provider upheld

The Rotterdam District Court has largely upheld a fine of €95,000 imposed on a trust services provider by the Dutch National Bank.

The DNB’s investigation started in 2019, and the fine was originally imposed on 2022.

The fine related to compliance failings including both money laundering and sanctions failures. The firm’s policies and procedures were insufficient and there was a lack of proper identification of the UBO and of ongoing diligence.

On appeal the fine was reduced to €90,250 due to an argument that the investigation process had been unduly lengthy,

October 8, 2024October 8, 2024 by Mark Handley

Netherlands – company convicted and fined for aircraft part exports

Further to our post of yesterday about an individual sentenced to 32 months for exporting aircraft parts to Russia in breach of EU sanctions, the Rotterdam District court has released a second judgment for the conviction of the company involved.

The company has been sentenced to pay a fine of €165,826. The prosecutor was seeking a fine of all the funds in the company’s bank accounts at the time it was raided, but it is unclear from the judgment whether the fine is that sum.

The company is not named in the judgment.

October 7, 2024October 7, 2024 by Mark Handley

Netherlands – two years and eight months sentence for exporting sanctioned goods to Russian airlines

On 3 October 2024, the District Court in Rotterdam sentenced an individual to 32 months in jail, as well as confiscation of $8,000 and €250,000 in cash, as well as the forfeiture of all the stock-in-trade and business bank accounts.

The individuals had exported over 460 prohibited aircraft parts to three different Russian airlines: i) Ural Airlines; ii) S7 Engineering LLC; and iii) JSC Siberia Airlines.

The defendant had created a paper trail to mask the destination of the exports which purported to show exports to Serbia, Turkey and Tajikistan. Internal documents, however, linked the exports to the Russian customers.

Messages on seized phones included: “We’re going to keep loading until we’re arrested”.

October 4, 2024October 4, 2024 by Mark Handley

Netherlands – Prosecution Service seeks 2-year sentence and confiscation for dual-use and other exports to Russia

The Dutch Prosecution Service has issued a press release stating that they are seeking a sentence for a 42-year old individual consisting of:

i) a 24 month custodial sentence of which 10 months is suspended;

ii) confiscation of all the proceeds of crime obtained from the breaches of sanctions; and

iii) forfeiture of the company’s stock.

As per our earlier posts the man was arrested in July 2023, for exports of electronic components and other dual use goods to Russia via Kyrgyzstan, Uzbekistan and Kazakhstan. The man is also alleged to have falsified records to mask the true destination of the exports.

In May this year the man had won a court hearing allowing his company to keep trading pending trial.

September 25, 2024September 25, 2024 by Mark Handley

Netherlands – fines imposed for making funds available to a designated person

Further to our earlier post from July 2023 regarding the arrest of a 73-year old individual, the Dutch Public Prosecution Service has announced that it has reached a settlement both with the individual and a related company. The press release is only available in Dutch and was not included amongst those published in English.

The company has been fined €195,000 and the individual, the company’s director, has been fined €20,000. The company and the individual have not been named.

The fines have been imposed because at the end of 2021 the company paid out dividends of approximately €18m to one of its shareholders who was a designated person under the EU’s Russian sanctions. The company also did not freeze the designated person’s shares, and continued to allow the shares to vote.

In addition, in 2019, a loan of €100,000 was repaid to a different Russian designated person in breach of the EU’s asset freeze.

September 12, 2024 by Mark Handley

Netherlands – conviction for breach of ISIS sanctions upheld by Court of Appeal

Yesterday the Court of Appeal in the Hague issued judgment on an appeal against a conviction for multiple terrorism-related offences including one of making funds or economic resources available to a person designated under the EU’s ISIS sanctions.

The transfers were of €200 and €300 respectively.

The conviction was upheld on the basis that the necessary criminal intent was present:

“In order to prove that the regulations have been deliberately violated, it is not necessary to prove that there was intent to violate the standards set out in the indictment. The intent is colorless. However, it must be proved that the defendant intended that the sums of money would end up directly or indirectly with [person 1] and [person 2], to whom the Terrorism Sanctions Regulations 2007-II applied at the time“.

The total sentence was for a custodial prison term of 48 months, but it is not possible to identify what proportion of that was for the sanctions offence and what proportion for the other non-sanctions convictions.

July 15, 2024July 15, 2024 by Mark Handley

Netherlands – corporate fine and confiscation for company’s role in building Kerch bridge

The Dutch Public Prosecution Service has issued a press release relating to a settlement with the company Dieseko Group BV for its role in supplying equipment and expertise for the construction of the Kerch bridge in breach of the EU’s sanctions in relation to Crimea.

The prohibited activities took place during 2015 to 2016 and were uncovered through press reporting in 2017. An investigation was commenced in 2017 (see our earlier post) and then expanded to include Dieseko (see our earlier post).

The company exported equipment and machinery (via Finland but with the knowledge that the goods were to go to Crimea) and supplied staff to the site to provide technical assistance.

The company was given the maximum available fine per each of the three counts with a discount for its cooperation with the investigation for a fine of €180,000. The cooperation includes document production and making staff available for interview.

The company has also had its entire “gain” from its work on the bridge confiscated of €1.6m. It is not entirely clear if this is gross or net profits.

The company has put in place remediation and compliance measures. The senior management of the company were interviewed as part of the investigation but will not be prosecuted as two have since passed away and one is seriously ill.

For the Statement of Facts see here.

For the Settlement Agreement see here (in Dutch).

The Dutch version of the Press Release includes comment that the Dutch intend to prosecute another company and several individuals for their involvement in the building of the Kerch bridge.

July 11, 2024 by Mark Handley

Netherlands – conviction for making funds available to designated person under Dutch sanctions

The District Court of Rotterdam has convicted an individual on one count of making funds (€350) available to a person designated under the Dutch Terrorism Sanctions Regulations 2007.

The defendant was acquitted of another charge of making funds available to ISIS on the basis of a lack of evidence that the defendant knew the recipient was connected with ISIS and because the transfer had taken place after ISIS had been largely defeated in Syria.

The individual was sentenced to 60 hours of community service, although this time had already been performed by virtue of a lengthy pre-trial detention.

June 17, 2024June 17, 2024 by Mark Handley

Netherlands – Attorney-General’s advice to uphold conviction and custodial sentence for ISIS sanctions violation

The post below has been updated on 17 June 2024 after the helpful input from the Sanctions Unit of the Dutch Ministry of Foreign Affairs:

Further to our earlier post, in late 2021 the Dutch Court of Appeal sentenced an individual to a six month custodial prison term for a number of offences including for making a payment in breach of the EU’s ISIS sanctions.

In his advice to the Dutch Supreme Court has upheld the Attorney General has advised that the convictions for terrorist financing and breaching the Dutch Sanctiewet 1977 be upheld, but that the conviction for money laundering be remanded to the Court of Appeal.

The facts relate to the transfer of €471 from an individual to his brother who was in Syria as part of ISIS. The defence sought to argue that the man did not have the required intent to support terrorism, or knowledge that the funds had benefitted ISIS.

As stated by the Attorney General at [2.9]:

“With regard to the violation of the provision of Article 2 of the Sanctions Act 1977, the offense proven under 2, the suspect’s intent does not have to be aimed at non-compliance with the legal regulations referred to in the finding of proof. The suspect’s intention must be aimed at ensuring that the money ends up indirectly with (a) terrorist organization”.

June 5, 2024 by Mark Handley

Netherlands – raids and arrests for suspected Russian timber imports

The Dutch FIOD has today issued a press release announcing raids on two businesses and two homes and the arrest of two individuals aged 73 and 46.

The arrests were on suspicion of importing Russian timber in breach of the EU’s sanctions and for circumventing the prohibition on Russian timber imports by purchasing timber through Chinese suppliers.

The businesses and individuals have not been named but the press release localises them in Ridderkerk.

The press release also confirms that the timber has been seized.