Bankruptcy fraud monitoring system fails to do the job: FD

A get-tough approach to bankruptcy fraud launched in June 2011 has failed to stop known offenders repeatedly setting up companies which then go bust, the Financieele Dagblad reports on Monday.


Despite new controls, one fraudster who is known to the justice ministry was able to set up 26 companies and foundations in the past 16 months, of which three have gone bankrupt.
Another person, who had been declared personally bankrupt several times and has a criminal record for tax and bankruptcy fraud, was able to set up 16 companies and foundations, the paper says.

Notorious

In total, the paper has supplied the ministry with a list of 98 ‘notorious fraudsters’ who have been able to get round the new controls.
The new supervisory system is fully automated and is supposed to look for changes in the chamber of trade registers relating to all forms of companies and foundations.
However the paper says it so far only monitors the bv and nv registers. In addition, the cost of the system has risen from an estimated €3.5n to €18.7m.
A justice ministry spokesman admitted the system is not ‘100% watertight’, the paper reported.

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