Dutch building companies face fraud charges

17 December 2003

AMSTERDAM — Four major construction companies will be prosecuted in the continued fall-out from the recent building fraud scandal that revealed Dutch companies were involved in illegal price fixing cartels.

The Public Prosecution Office (OM) said on Wednesday it will prosecute BAM (inclusive HBG), Heijmans, KWS (a subsidiary of VolkerWessels) and construction company Koop.

A total of 12 staff will also be personally prosecuted, three of whom are suspected of bribing public servants. The suspects include four KWS employees, two from BAM and three from Heijmans, public news service NOS reported.

A decision will be made at a later date if a hundred other workers, construction companies or government organisations will be prosecuted. On request from the suspects, a judge must still hear testimony from other suspects, after which a decision will be made about subsequent prosecutions.

Justice officials resolved in January to prosecute 12 public servants. They were charged with forgery, fraud, participation of a criminal gang and various other crimes.

The building fraud scandal came to light at the end of 2001 when a former Koop director, Ad Bos, revealed shadow account keeping practices at the Groningen-based construction company.

It was alleged that construction companies shared work and made illegal price agreements. Bos later supplied justice officials with the names of allegedly corrupt public servants.

The Lower House of Parliament, the Tweede Kamer, requested a parliamentary commission to investigate the matter. The commission’s inquiry later revealed that the government paid almost 90 percent too much for construction projects due to underlying price fixing.

The OM also launched its own investigation and over a period of two years has examined eight building projects in which the construction companies are alleged to have made illegal price agreements.

The court cases will be held in Rotterdam and the OM has asked the court to reserve 40 days for the hearings. The cases will begin in the Spring of 2004.

Subject: Dutch news