The Money Laundering and Terrorist Financing Prevention Act (Wwft) has been in force in the Netherlands for many years. It is an important law that ensures that companies and organizations struggling with money laundering and terrorist financing risks take measures to mitigate these risks. But how did this law come about? In this blog, we zoom in on the history of the Wwft and how it came about.
History of the Wwft
In the Netherlands, the first Identification in Services Act (Wid) was passed in 1993. The law was mainly concerned with the identification of customers by providers of financial services. However, after the terrorist attacks on Sept. 11, 2001, the law proved insufficient to curb the risks of terrorist financing. This prompted the government to set up a committee to investigate how the Netherlands could better guard against money laundering and terrorist financing.
The Intelligence and Security Services Oversight Committee issued a report in 2003 stating that a new framework was needed in the Netherlands to deal with money laundering and terrorist financing. In response, the Dutch government decided to introduce a new law that required companies and organizations to monitor transactions related to money laundering and terrorist financing. This new law was called the Money Laundering and Terrorist Financing Prevention Act (Wwft).
Several changes have been made since the introduction of the Wwft in 2008. For example, the Wwft was renewed and tightened in 2018 to better deal with new risks and threats. One of the most important changes was that all companies and organizations covered by the Wwft must conduct a risk assessment to determine their own risk of money laundering and terrorist financing. This ensures that companies and organizations working with money laundering and terrorist financing risks can adopt an appropriate approach.
Over the years, there have been many motions to improve legislation and better incorporate new risks. The 2018 Bill on Expansion of Administrative Enforcement Instruments Act (Wwft) is one such example. This law gives supervisors the ability to impose administrative sanctions when companies and organizations fail to comply with the Wwft.
The Wwft is an important law that requires companies and organizations to take measures to reduce the risks of money laundering and terrorist financing. The law was created in response to risks and threats of terrorist financing and money laundering that came to light after the September 11, 2001 attacks. Since then, the law has been strengthened and renewed to better address the increasing risks. The introduction of a system of risk assessment ensures that companies and organizations identify their own money laundering and terrorist financing risks, and address them appropriately. The Wwft is an important tool for the Dutch government to combat money laundering and terrorist financing, and will continue to play an important role in ensuring the integrity of the financial sector in the Netherlands.
