It was the first criminal investigation that Jeroen Drost ended up in and he does not want to experience it again. “So long. Such a process is enormously drastic, isn’t it.”
Since the end of 2016, the Public Prosecution Service has been investigating international corruption at SHV, the family business of which Drost is chairman. “It took almost five years. Constant investigations, unrest among employees.” Why did it take so long? “You have to ask the Public Prosecution Service about that. Sometimes it was quiet for months and then it was picked up again, then it was quiet again, it was picked up again.”
That criminal investigation is now over. At the end of April, subsidiaries Eriks (industrial service provider) and Mammoet (heavy transport) settled with the Public Prosecution Service for more than 40 million euros, for three corruption cases. The issues unwittingly pushed the long-closed company of the Fentener van Vlissingen family – a conglomerate of seven subsidiaries and more than 51,000 employees in 64 countries – into the spotlight for years.
Questions from NRC, which was the first to write about the corruption issues, kept SHV off all along. But now that Drost is speaking to reporters at the head office on the Rijnkade in Utrecht, he speaks freely. The visit is led past the marble columns in the hall, past the camera that automatically detects body temperature, past the giant mosaic in the floor – which Drost sometimes tells foreign guests that members of the family are buried under, he says – to the bright conference room on the first floor. With the cranes that Hoog-Catharijne are renovating in the background, he throws up his hands. “Fire away.”
How did SHV find out about the corruption issues?
“With us, people often rotate between the groups. A colleague moved from the energy branch to Eriks at the end of 2015 and visited the Econosto branch in Dubai for the first time [een bedrijfsonderdeel van Eriks]. There he was soon confronted with what appears to be illegalities. He came back and said, ‘I’ve got signs it’s not right.’”
“We soon came to the conclusion that this was so extensive that we could not handle it ourselves. Then you call in law firm De Brauw, the forensic accountants from Deloitte, the whole thing. De Brauw interviewed dozens of employees and Deloitte started to help with technology and accounting and filtering e-mails, a huge amount. And then it suddenly begs the question: if this happens at Econosto in the Middle East, can it also happen elsewhere at Econosto? Or at another activity of ours in the Middle East?”
That’s how you ended up with Mammoet?
“Yes, with the bribe at the crane branch. And on that issue in Iraq, we saw for ourselves that there was a consultancy agreement was signed with an Iraqi parliamentarian: a politically exposed person. They should never have done that.”
At the end of 2016, SHV itself will go to the Public Prosecution Service and report the corruption to Econosto, but not the two issues at Mammoet. Why?
“Our research showed that a lot of commissions were paid at Econosto in Dubai. A commission does not have to be a problem, you also pay it to a broker. But if you pay commissions to buyers who work for the customers, you have a duty to check that it is not a bribe. Those committees are all possible, but they didn’t know well enough whether it was right and they should have. It also turned out that 30 percent of the turnover depended on those commission payments. If that’s your business model, that model sucks. It is incomprehensible that it could have existed for so long. It was different at Mammoet, where the bribes were one-off actions. Not good either, but of a different order.”
Did you not immediately think when paying an Iraqi parliamentarian to smooth out a salvage job: this is corruption?
“I find corruption complicated. The contact was wrong. It turned out that the son of a parliamentarian had been approached. How come you hire a parliamentarian’s son? If you want to approach the MP, you approach him. There is nothing wrong with that.”
But with paying a parliamentarian to get something done, right? The Public Prosecution Service calls this corruption.
“Well you can have a whole discussion about that, whether that is really the case. But they should never have signed the contract with the MP like that. It has not produced any madness at all, the Public Prosecution Service has also acknowledged that. It was a bad project and it didn’t work.”
Does that make any difference to whether or not to report to the Public Prosecution Service?
“Some things are incidents. I find it annoying incidents that we are ashamed of, but we have 51,000 employees. Even though we explain to them what not to do, they sometimes do things that are not in line with the laws and regulations and SHV’s philosophy. That’s very frustrating, but it’s true. Then we take measures.”
Shortly before SHV reported the matter to the Public Prosecution Service, NRC asked employees about the Econosto issue. Did you know about that?
“Doubtless. You were making quite a noise.”
Was that the reason to go to the Public Prosecution Service?
“Not really. Such a process starts a year in advance, and after all the interviews and investigations you come to the conclusion, all things considered, that you should report it.”
The subsidiaries were rewarded in the settlement with a discount on the fine for cooperating well with the Public Prosecution Service. How does such a collaboration work? You give something and get something in return?
“You get nothing back. The first thing our lawyer said was: they are the Public Prosecution Service and you are not.” Drost holds one hand high, the other a lot lower. “You do not negotiate with the Public Prosecution Service.”
Did you ask if the FIOD wouldn’t raid the headquarters?
“No, they don’t have to ask permission for that. We did say to them: if there is something, and that could be anything, let us know. Then we can ensure that it is collected in the right way.”
The Public Prosecution Service has not received the internal investigation of De Brauw from SHV.
“Some pieces do, some don’t. I also never received the full official report from the Public Prosecution Service. There are many interview reports in the report, from a lawyer who interviews our employees. You can’t just use those interviews for a criminal investigation. We also have a duty of care towards employees. Do I have to ask permission from those people, without knowing whether they will be prosecuted or not? That is not even legally possible.”
Ten former employees of Eriks and Mammoet are still suspected.
Have you been tapped yourself?
“Yes. I read that in a report. That is a very uncomfortable feeling. It may sound silly, but I wasn’t here when all this happened. So you can accuse me of anything, but I wasn’t with SHV yet. I believe that the threshold for tapping someone is not very high.”
Are the people who have been interrogated or heard by the FIOD prepared by SHV’s lawyer?
“We have offered that they all have themselves represented professionally. I think that’s the right thing to do, because I wouldn’t have the faintest idea what would happen to me if I was asked to visit the Public Prosecution Service or the FIOD. We have also offered to pay the charges unless they are suspicious and it all goes wrong.”
Read more about NRC’s investigation into corruption at SHV: Buried under a thick layer of sand
The Public Prosecution Service used the SHV case to demonstrate a new style of combating corruption. Register yourself, cooperate and you will receive a discount on the fine. The next time you find something, will you think: I will run to the Public Prosecution Service again?
“Well, I never think so. It’s not a consideration for us. I don’t believe we’re going to report anything because of a discount or not. Overall, I think it’s a good method. It is quite difficult for the Public Prosecution Service to get information from abroad.”
You said earlier that the corruption at Econosto was structural. How could it go on for years under the SHV umbrella?
“It is incomprehensible that this was possible. Bizarre. It started a long time ago and has become an accepted way of doing business in the Middle East, where this is much more common. It’s growing, people are apparently getting used to it.
“SHV has traditionally been very decentralized, based on trust. We have learned that even better we should tell the companies that they have to control what is happening.”
Is SHV responsible for the corruption in the subsidiaries?
“We do feel responsible. We take it morally and we are ashamed of it, let there be no doubt. We closed the operation in Dubai, which cost a lot of money and lost 100 people their jobs. We have turned away dozens of people who were involved. But legally I’m not responsible for anyone’s behavior somewhere in the desert. I’m not going to apologize for something I wasn’t there for.”
Shouldn’t SHV completely get rid of corruption-prone countries?
“Um, cross the border into Germany and you’ll find corruption there too. People in difficult countries are more alert than in countries where you don’t expect it.”
What is SHV doing now to prevent abuses?
„In 2007 or 2008 we started making a internal auditdepartment in all subsidiaries. Now companies also have to ethics & compliancehave a department. You check the customer, you educate your people, there is the external accountant. As a result of this hassle, we also had a huge discussion about our purpose. Who are we, what do we do, what drives us, what are our standards and values? To also emphasize the soft side. And we have a speak-up policy. People can call a phone number to report suspicious things.”
How many people do that?
“Hundreds a year. But such a report sometimes turns out to be about an argument with the boss. We are most concerned about countries where there are no reports at all, such as China.”
Is something like human rights still a consideration for leaving countries?
“We feel responsible for the way we do business. That is now at play with subsidiary Nutreco with certain vitamins that come from China. Amino acids I believe. They are made there. There is now an accusation that it cannot be ruled out that it violates human rights.”
“Yes. And that is reason for us to have Nutreco, who had come up with that themselves, to do a thorough investigation to see if we can get our finger on it.”
A version of this article also appeared in NRC Handelsblad on 26 June 2021
A version of this article also appeared in NRC in the morning of June 26, 2021