The Bottom Line
- Direct Liability: If your company’s bank account receives proceeds from a crime like bribery, those funds are subject to confiscation. The court will focus on the money trail, not just who orchestrated the deal.
- Failed Defense Strategy: A company cannot successfully appeal a profit confiscation order by raising legal arguments that belong to a separate case against its director. Each legal entity must stand on its own facts.
- Corporate Veil Won’t Save Profits: The legal concept of “identifying” a director with their company is irrelevant for confiscation when the company itself is the direct recipient of illegal funds.
The Details
This case involved a Dutch company, referred to as [betrokkene] B.V., that was ordered to forfeit profits it gained through active bribery. The core of the matter was that the commission payments resulting from the bribery were deposited directly into the company’s bank account. The company appealed this confiscation order to the nation’s highest court, attempting a novel legal argument to protect its illicit gains.
The company’s defense before the Supreme Court was fundamentally flawed. Instead of focusing on its own liability, its legal team based its appeal on arguments from the parallel criminal case against the company’s director. They challenged the lower court’s reasoning for holding the director personally liable and the legal principle of “identifying” the director with the company. This strategy aimed to indirectly undermine the basis for the confiscation from the company itself.
The Supreme Court, following the advice of its Advocate General, dismissed the appeal as inadmissible. The reasoning was straightforward and pragmatic: the money trail was key. Since the illegally obtained funds were demonstrably paid into the company’s account, the company was the direct beneficiary. Therefore, it was unnecessary to delve into the complex legal doctrine of “piercing the corporate veil” or identifying the director’s actions with the company to justify the confiscation. The company’s arguments were deemed irrelevant to its own case, as they pertained to the separate legal proceedings of its director.
Source
Supreme Court of the Netherlands
