Instruction for IQ EQ Netherlands N.V. for insufficient customer due diligence

Gatekeepers

Action against money laundering and terrorist financing is fundamental to the effective countering of serious crime. Trust offices have an important gatekeeper function in this regard. There is a risk that trust services could be misused for money laundering, terrorist financing or other socially improper behaviour. Based on the Act on the Supervision of Trust Offices (Wet toezicht trustkantoren – Wtt 2018), they are required to design their business operations so that they can effectively identify and manage integrity risks. To do so, it is important that trust offices know who their customers are, where the customers’ money comes from and why these customers need the trust office’s services. It is also important that the trust office has an effective ongoing monitoring process in place so that it can detect and report unusual transactions to the Financial Intelligence Unit (FIU-NL) in a timely manner. IQ EQ failed to fulfil some of the obligations to conduct proper customer due diligence. 

Customer due diligence

DNB examined six of IQ EQ’s customer files and found shortcomings in all of them. The shortcomings relate to establishing the customer’s integrity risk profile, the origin of the object company's assets, and the asset position of the ultimate beneficial owner (UBO). On this basis, DNB concluded that IQ EQ has not sufficiently identified the relevant integrity risks with respect to its customers, with the consequence that IQ EQ is insufficiently able to take appropriate mitigating measures. It should be noted that IQ EQ serves customers operating in sectors or countries that carry high risks of money laundering, terrorist financing, corruption and tax evasion, among other things. This creates an increased risk of involvement in financial crime such as money laundering, terrorist financing or tax evasion. 

Instruction

DNB's enforcement approach is primarily aimed at promoting compliance with the law. In issuing the instruction to IQ EQ, DNB took into account that a formal measure was appropriate for the severity, number and duration of the instances of non-compliance found. An instruction is an enforcement measure in which DNB orders an institution to perform one or more prescribed actions aimed at terminating or redressing its non-compliance. The prescribed course of action in the instruction entails that IQ EQ must bring all customer files into compliance with the relevant provisions of the Wtt 2018 by 31 July 2025 at the latest. IQ-EQ adopted and shared its final improvement plan with DNB in May 2024 and has since reported to DNB on the implementation of its improvement plan. 

Objection

IQ EQ lodged an objection to the instruction. DNB declared this objection unfounded. IQ EQ did not appeal this decision.

See below for the full instruction, the decision to implement a change and the decision on the objection, excluding confidential information. For additional information, you can contact our Information Desk by telephone at 0800 020 1068 (freephone in the Netherlands) or +31 20 524 9111 (if calling from abroad). 

Current situation of proceedings

The table below shows the current status of this decision.