On 13 June 2014, the Netherlands Authority for the Financial Markets (AFM) imposed an administrative fine of €24,000 on Mr I. Hony for de facto management of the illegal offer of investments by Veldmaarschalk N.V. (Veldmaarschalk).
The AFM has established that Veldmaarschalk offered consumers plots of land in Terneuzen and Vianen in the period of 01 July 2009 to 28 December 2011, which involved speculation on a value increase resulting from a change in the intended use.
By speculating on this value increase, Veldmaarschalk promised a good return on investments. The management of the land was performed by a party other than the investor. That constitutes offering investments. According to Section 2:55 of the Financial Supervision Act (Wft), this activity requires a licence. Veldmaarschalk stopped offering investments on 28 December 2011.
It is important that financial service providers hold a licence granted by the AFM. A licence offers protection to consumers. Before the AFM grants a licence, it checks, inter alia, whether a financial service provider complies with the requirements of properness, expertise and integrity. Moreover, a service provider that holds a licence must comply with the so-called continuous rules of conduct. These concern, inter alia, proper services to consumers.
De facto management by Mr Hony
Mr Hony was indirect director of Veldmaarschalk and he was directly involved in the violation. For instance, he signed several purchase agreements with investors. The AFM established during its investigation that Mr Hony was aware of Veldmaarschalk's investment offers, that he was authorised and reasonably obliged to terminate these offers and that he failed to take measures to do so. These are criteria developed in case law for assuming de facto management of a violation.
This case is subject to the fine scheme that applied until 01 August 2009. It applied a system of fixed penalty amounts. The AFM has mitigated the fine from the highest category (€96,000) to a lower category (€24,000).
Interested parties can submit the AFM's judgment contained in the decision to the courts for review.
If you have questions or complaints, please contact the AFM's Financial Markets Information Line: 0800-5400 540 (free of charge).
Press release land investments
The AFM recently informed consumers concerning the risks inherent in land investments. The offers mainly involve agricultural plots in the Netherlands and in Eastern Europe. Consumers are advised to perform a thorough investigation if they are considering an investment in land.
The AFM is committed to promoting fair and transparent financial markets.
As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.