Crime prevention

They check whether criminals set up businesses, launder money or demand protection money. This is known as the administrative approach to organised crime. 

To launder money, criminal organisations are sometimes dependent on municipal permits, grants or contracts, for example to open a bar, restaurant, international telephone shop or sex club. Even a pizza delivery service can be a cover for drug dealing.

Screening

To prevent the public authorities unwittingly facilitating crime, the Public Administration (Probity Screening) Act has been introduced so that municipalities and other authorities can check the criminal records of businesses and individuals.

Refusal of permits

Municipalities can discourage criminals from locating in the municipality by refusing to issue permits or award grants. If a bar, for example, is linked with criminal activity, they can also close down the business or withdraw its permit.

Prevention

The government supports municipalities in the fight against administrative crime. Administrative enforcement prevents crime. Criminals will apply for permits and grants less often and will have difficulty laundering money.

Prevention of tax fraud and the evasion of social insurance contributions

Businesses and employees can commit fraud by evading tax (e.g. through undeclared work), not remitting social insurance contributions and hiring illegal workers. The inspectorates check whether businesses provide information on the number of employees they have and whether they have the right papers for foreign employees.

In the coming years, the government will concentrate on fraud prevention. Clear regulations and good information campaigns must ensure that businesses and employees keep to the rules. If they do not and the government finds out, they will be fined and forced to pay the contributions and taxes they have evaded.

First-day notification of new employees

If there is a high risk of an employer hiring illegal or undeclared workers, the Tax and Customs Administration can require the employer to make a first-day notification. The company must notify the Administration of new employees before they start work. If it does not, the Administration can impose a fine.

Combating benefit fraud

Benefit claims are checked for fraud the moment they are made. The Employee Insurance Agency and the municipalities check the particulars provided. They can also ask the Intelligence Service to assess the information.

All benefit recipients have a number of obligations. They must report changes in their circumstances and income, for example, as they might affect the benefit. The benefit office and the Employee Insurance Agency will check that the rules are being followed. If not, the benefit can be reduced or even withdrawn.

Checks on living arrangements

The government wants to give municipalities and benefit agencies (such as the Employee Insurance Agency) more powers to check the living arrangements of benefit claimants, for example by visiting them at home. By carrying out more checks, the government aims to cut the number of undue benefit payments made to people who are not entitled to them.

The Minister of Social Affairs and Employment submitted a Bill to the House of Representatives on 21 April 2009 to check the regularity of benefit payments by means of home visits. It will enter into force once it has been debated and passed by the Senate and House of Representatives.

Income abroad

A benefit recipient’s foreign income and capital affect the level of benefit. Fraud prevention therefore does not stop at the border. Municipalities have the power to investigate foreign assets. The International Fraud Information Office (IBF) coordinates the exchange of information between municipalities and foreign authorities.