The AFM published a fine on 2 October 2012 that it had levied on Ernst & Young on 9 November 2011. The AFM issued the EUR 217,810 fine for inadequate supervision of compliance with the Audit Firms Supervision Act ("AFSA") by Ernst & Young's compliance officer in the period 1 January 2009 to 15 February 2010.
According to the AFM's investigation, the compliance officer appeared not to have conducted the activities that he had described in his annual plan. He did not identify or address specific compliance issues or risks in his 2009 annual plan. Nor did he plan or carry out any activities with regard to specific risks, according to the AFM.
The AFM also concluded that Ernst & Young did not appoint a new substitute compliance officer after the departure of the serving substitute compliance officer. The AFM attaches great importance to the presence of a replacement compliance officer, as he or she could supervise the compliance officer's duties when – as in this case – a conflict of interest threatens to occur. The compliance officer in question was, for example, also external auditor. A compliance officer may not supervise activities that he himself is involved in. A replacement compliance officer should have taken over his duties, according to the AFM. The AFM considered the breaches of the AFSA serious. Supervision by the compliance officer of the internal system of quality control is an essential element of a properly functioning auditors firm. According to the AFM, the compliance officer is an important point of contact for the day-to-day policy makers and also for the AFM as regulator.
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