Minister Kaag and her foundation are wrong with their own anti-money laundering rules

Minister Kaag and her foundation are wrong with their own anti-money laundering rules
Minister Kaag and her foundation are wrong with their own anti-money laundering rules

This is apparent from research by RTL Z.

Before Kaag became a minister, she placed her business and financial interests in a foundation. This is mandatory, so that as long as she is a minister she has no say over it. This should prevent conflicts of interest.

Mandatory registration

Since this year, it is mandatory for all companies and foundations to honestly state who the ultimate beneficial owner is, the UBO (ultimate beneficial owner). This legislation must ensure that, for example, banks and supervisors can find out who the real owner is. This is to prevent tax evasion and money laundering.

Research by this site shows that Kaag is not registered as the UBO of her own foundation. Instead, the three independent directors have been designated as beneficial owners.

Not according to the rules

And that’s not according to the rules. Anyone who directly or indirectly has an ownership interest of more than 25 percent must be declared as an interested party. The law clearly prescribes that someone who is entitled to the money of a foundation after it has been dissolved, which happens when Kaag is no longer a minister, is the owner.

That turns out to be the case. Although the articles of association do not literally state that Kaag is entitled to the ‘surplus after liquidation’, it does state that the destination of the surplus ‘will be determined in accordance with the purpose of the foundation’. Since the purpose of the foundation is to look after the business and/or financial interests of the founder, it is clear that the money belongs to her.

New insights

In a response to questions from RTL Z, the ministry announced that after consultation between the board members of the foundation and the notary’s office that provided the UBO registration, it was decided to designate Kaag as a UBO after all, because on closer inspection they did indeed indirectly owns it.

“After consultation between directors of St Jude and the notary, it has been agreed that due to the representation of interests, the founder may be expected to be an indirect beneficiary, making him the UBO, rather than the directors.”

blunder

“It is quite a blunder that the minister himself made a mistake with this,” says political reporter Roel Schreinemachers.

“Kaag has been insisting for some time that it must always be clear who the ultimate stakeholder is with these types of constructions. So it is stupid to say the least that the minister himself appears to have not arranged this properly.”

Technical defense

According to the ministry, the fact that the minister was not initially regarded as the ultimate beneficial owner of the foundation that she set up herself to represent her financial interests is because the notarial profession is of the opinion that ‘technically speaking’ she is not automatically entitled to the surplus. after dissolution, but that a decision must first be made by the board.

The foundation and the notarial profession are therefore of the opinion that this should be viewed differently in the case of Kaag.

22,500 euro fine

The Ministry of Finance also states that the responsibility for correct registration lies with Kaag’s foundation, and not with Kaag itself. “The foundation must ensure that the UBO data is correctly and completely registered at all times.”

There is a considerable penalty for not correctly complying with the UBO legislation. The Economic Enforcement Office of the Tax Authorities, which falls under the Ministry of Finance, can impose a fine or order subject to a penalty of 22,500 euros. Infringers are usually given the opportunity to correct the statement first, the ministry said.

St Jude . Foundation

Minister Kaag founded the St Jude foundation at the end of last year. The deed of incorporation shows that the foundation is charged with managing an investment portfolio of the minister and the management and rental of a second home in Switzerland.

The article is in Dutch

Tags: Minister Kaag foundation wrong antimoney laundering rules