{"id":6040,"date":"2020-02-28T00:00:00","date_gmt":"2020-02-27T23:00:00","guid":{"rendered":"https:\/\/www.ludwigvandam.nl\/collection-fraud-results-in-franchisor-4-years-in-prison-and-a-fine-of-e-7-million-dated-25-february-2020-mr-jaj-devilee\/"},"modified":"2023-07-07T17:43:34","modified_gmt":"2023-07-07T15:43:34","slug":"collection-fraud-results-in-franchisor-4-years-in-prison-and-a-fine-of-e-7-million-dated-25-february-2020-mr-jaj-devilee","status":"publish","type":"post","link":"https:\/\/www.ludwigvandam.nl\/en\/collection-fraud-results-in-franchisor-4-years-in-prison-and-a-fine-of-e-7-million-dated-25-february-2020-mr-jaj-devilee\/","title":{"rendered":"Collection fraud results in franchisor 4 years in prison and a fine of \u20ac 7 million – dated 25 February 2020 – mr. JAJ Devilee"},"content":{"rendered":"

\n Although it is quite exceptional, in franchising country you come across every now and then
\n proverbial cowboys against. In a very exceptional criminal case
\n issue, the Arnhem-Leeuwarden Court of Appeal (ECLI:NL:GHARL:2019:11154)
\n recently ruled that one of the directors of a (former)
\n franchisor of a catering formula should serve a prison sentence
\n sentence of four years and nine months and a fine
\n pay more than seven million euros.
\n \n<\/p>\n

\n Background<\/b>
\n \n<\/p>\n

\n The director of the franchisor is (partly) suspected that he
\n operated for various franchisees. For the purposes of collecting the
\n franchise fees, the franchisor had entered into collection contracts with
\n the couch. By means of these collection contracts, amounts (fees)
\n are collected. However, the bills turned out not to belong to
\n franchisees. An amount to be collected by the franchisor then became
\n for example by the bank, in anticipation of the success of the collection or on
\n advance basis, deposited into one of the accounts. Meanwhile, these
\n amounts passed on or withdrawn by the franchisor. In a devious way
\n an attempt has been made to disguise this by the director of the franchisor.
\n This created an illegal source of income.\n<\/p>\n

\n The bank filed a report in September 2011 in connection with these actions
\n against the director of the franchisor for suspected fraud
\n act when using these direct debit contracts with which the bank provides
\n more than an amount of approximately \u20ac 11 million would have been damaged.\n<\/p>\n

\n Judicial judgment<\/b>
\n \n<\/p>\n

\n In the first instance, the court had imposed an unconditional prison sentence
\n of four years. The director subsequently appealed
\n the verdict. On appeal, the Court of Appeal also finds the director
\n guilty and imposes even a higher sentence than the court. It
\n The court sentenced the suspect to four years and nine months
\n unconditional imprisonment; a disqualification from the right of
\n statutory director for nine years and nine months and an obligation
\n for compensation of damage of \u20ac 7,019,544.79.\n<\/p>\n

\n Conclusion<\/b>
\n \n<\/p>\n

\n Although the above concerns an almost unique situation, there are
\n franchisors who don’t always color within the lines. In the present
\n issue showed that the franchisees who were affiliated with the formula
\n were not involved in the aforementioned collection fraud. However, it may be obvious
\n be that such behavior of the franchisor can cause enormous reputational damage
\n to affiliated franchisees, but also to the franchise industry
\n in general, with all its consequences. Do you suspect fraud in the
\n organization of your franchisor and do you have advice in such a case
\n need, please give us a call.<\/p>\n

<\/p>\n

mr. JAJ Devilee<\/p>\n

Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Go to devilee@ludwigvandam.nl<\/a><\/p>\n

 <\/p>\n

Click here<\/a> for the published article. <\/p>\n","protected":false},"excerpt":{"rendered":"

In a highly exceptional criminal case, the court recently sentenced one of the directors of a (former) franchisor to imprisonment and a fine.<\/p>\n","protected":false},"author":11,"featured_media":5052,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[214],"tags":[],"class_list":["post-6040","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-statements-current-affairs"],"acf":[],"yoast_head":"\nCollection fraud results in franchisor 4 years in prison and a fine of \u20ac 7 million - dated 25 February 2020 - mr. 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