BFT stands for Bureau Financieel Toezicht (Financial Supervision Office). BFT is a supervisory body and oversees the compliance with laws and regulations by bailiffs and notaries and the compliance with the Money Laundering and Terrorism Financing (Prevention) Act (in Dutch: WWFT) by various professional groups.
- Independent. BFT will not allow itself to be influenced; neither through the collection of information, nor during assessments or interventions.
- Transparant. ‘Confidential where necessary, transparent where possible’.
- Professional. Modern supervision demands supervisors which are flexible, transparent, involved and respectful in the way they work.
- Selective and efficient. Supervision activities are always chosen based on a consideration of risks, effectiveness, proportionality, costs and benefits.
- Decisive. Which aims at: ‘restraint where possible, bold when a situation demands it’.
Focused on working together. Working together is an important means to reduce the perceived burden of supervision.
BFT conducts regular meetings with the Ministry of Security and Justice, the Ministry of Finance and various different representative professional organizations of those who have been put under supervision, in order to carry out efficient supervision. BFT also conducts regular meetings with other supervisors.
The standards relevant to the supervision are determined by the relevant laws and regulations, ministerial regulations and the (disciplinary) jurisprudence. These standards are the assessment framework for BFT.
BFT’s supervision area differs per professional group. BFT is the financial supervisor where bailiffs are concerned. BFT integrally supervises the notaryship (including WWFT). And finally, BFT is also tasked with supervising the compliance with the WWFT by, for example, tax advisors, registered accountants, accountants and administration consultants, or any people who carry out comparable activities, like administrative offices, tax advisors and business advisors.
The financial supervision of bailiffs is aimed at securing the public trust in that third party funds entrusted to bailiffs are safe and secure.
A good information position is essential for BFT, in order to enable it to adequately carry out its supervisory task. BFT uses information from the bailiffs themselves to build up its information position. Bailiffs periodically provide BFT with (financial) information.
A risk focused investigation may take place at the bailiff’s if the submitted (financial) information gives rise to this. Plus periodic investigations will also take place. The bailiff is obliged to cooperate with any investigation conducted by BFT. A report will be drafted as a result of the investigation.
BFT may take enforcement action. The aim of enforcement action on the one hand is to correct any non-conformant behaviour, whilst it also has more of a corrective character. A number of enforcement examples include a standard transmissive conversation or the filing of a disciplinary complaint – in case of more serious standard violations – with the disciplinary judge (room for bailiffs).
The integral supervision of the notaryship is aimed at the following focus points: finance, integrity (including WWFT) and the quality of the notary. The legislature wants an effective, efficient and preventive supervision of the notary. This is why BFT largely opts for risk focused supervision. This means offices which deal with matters which can have a major social impact or offices which display those financial, integrity and quality risks will be dealing with the supervision most intensively (based on the information known to BFT).
The integral supervision is aimed at both the notary, as well as the added notary and the notary candidate.
A good information position is essential for BFT, in order to enable it to adequately carry out its supervisory task. BFT will start with using information from the notaries themselves to build up its information position. Notaries periodically provide BFT with (financial) information.
BFT has powers from the General Administrative Act (in Dutch: Algemene wet bestuursrecht (Awb)) which lead to the notary’s obligation to cooperate. Title 5.2 from the Awb is applicable to the supervisory task. BFT thereby has the authority to, for example, produce copies of business information and files. BFT is also authorized to inspect the notary’s personal financial administration. The Awb will also allow for information from third parties to be involved in the supervision. The notary does not have a confidentiality obligation where BFT is concerned and can therefore not call on his right to refuse to answer questions.
Investigations by notaries can take place for all manner of different reasons. If the risk analysis gives rise to this, a risk focused investigation can take place, based on the collected information. A report will be produced as a result of the investigation.
BFT may take enforcement action. The aim of enforcement action on the one hand is to correct any non-conformant behaviour, whilst it also has more of a corrective character. A number of enforcement examples include a standard transmissive conversation, imposing a fine or penalty or – in case of more serious standard violations – submitting a disciplinary complaint with the disciplinary judge (room for the notaryship).
BFT has been appointed as one of the supervisors for ensuring compliance with the conditions stipulated by the anti money laundering regulation in the Netherlands: Money Laundering and Terrorism Financing (Prevention) Act (in Dutch: Wet ter voorkoming van witwassen en financieren van terrorisme (WWFT). Previously The Identification (Provision of Services) Act 1993 (In Dutch: Wet identificatie bij dienstverlening (Wid)) and The Disclosure of Unusual Transactions (Financial Services) Act (in Dutch: Wet Melding ongebruikelijke transacties (Wet MOT)).
BFT is tasked with supervising, for example, (candidate) notaries and added notaries, lawyers, tax advisors, registered accountants, accountants and administration consultants, and any other independent professional or business which carries out comparable activities, like administration offices, tax advisors and legal and business advisors.
Monitoring compliance with the WWFT is based on a three-pronged policy
- Increasing awareness of the laws and regulations, (money laundering) risks and the importance of combating terrorism and money laundering (by way of publications and presentations);
- Stimulating the compliance with laws and regulations via professional organizations and associations, whether or not via peer reviews (intercollegial testing);
- Testing the compliance with laws and regulations by the aforementioned professionals through own regular and risk focused investigations.
BFT skills and legal framework
BFT’s powers are governed by chapter 4 of the WWFT (article 24 and beyond) and the General Administrative Act (department 5), (in Dutch: Algemene wet bestuursrecht (Awb))
On site investigation
Considerations during on site investigations are the set up and existence of a risk policy, set up risk profiles per client, client acceptance procedures, file structure, internal control measures, education and training courses for personnel and introducing measures in the payment organization. BFT will assess whether identification and verification of the identity of the client and the UBO (‘Ultimate Beneficial Owner’) and/or PEP (‘Politically Exposed Persons’) have been correctly carried out, using the client files selected by BFT. Plus the supervision investigation is also aimed at ensuring that the institutes provide notification of any unusual transactions.
When a lack of compliance where the legal conditions and violations thereof have been established, BFT can issue mandatory instructions to develop procedures and controls, as well as to follow training. Administrative or disciplinary sanctions are also an option. BFT is authorized to impose an administrative fine and a penalty. BFT can inform the prosecutor in serious cases, who can subsequently initiate a criminal investigation. Failure to comply with the WWFT qualifies as an economic offense.
Financial Supervision Office
3584 BS Utrecht (the Netherlands)
Fax: +31 (0) 30 – 254 37 85