Investigators link many Amsterdam tourist shops to money laundering, drug trafficking

An investigation into the proliferation of stores selling trinkets to tourists in Amsterdam found that many of them may be linked to the criminal underworld. The shops are often located in storefronts that can command some of the highest rental prices in the city. Police, prosecutors, and tax officials joined up for their first-ever investigation into how this is possible, according to a report published in Parool on Saturday.

Investigators in one operation took a deeper look at four principal owners of different chains of small retail shops. The authorities joined up in the Amsterdam Regional Information and Expertise Center (RIEC) to uncover participation in criminal acts which undermine public order and the rule of law.

Parool reported that the case started with visits to seven souvenir and tobacco shops on Nieuwendijk, a shopping street in the city center. Investigators found the stores selling cocaine cutting agents, precision scales, high-end measuring equipment, and other items used in the distribution of hard drugs. Amsterdam Mayor Femke Halsema ordered six of the businesses closed, and authorities in Loosdrecht, just west of Hilversum, shut down a wholesaler connected to the investigation.

Investigators then focused on four specific business owners who are independent of each other and are not believed to be part of a network of criminals. They own a combined total of ten souvenir shops, four other stores that focus on tourists or new immigrants, such as telephone shops and souvenir clothing stores, a kiosk, and three wholesale businesses. The businesses are mainly located in the city center. Parool noted that they also claim to sell tobacco and candy, according to their business registrations.

Two of the business owners saw dramatic increases in turnover, the newspaper reported based on a review of the investigation. This sometimes amounted to several millions of euros in a single year. All four have ties to people implicated in other organized crime scams, including underground banking, loan sharking, money laundering, and drug trafficking.

Abnormally high amounts of cash were found in some stores. Many of them also make large cash deposits in bank accounts which are inconsistent with turnover from average tourism stores. Two of the four owners kept their stores stocked with a large amount of high-value bank notes ranging in denomination from 100 to 500 euro, which raised suspicion as the shops supposedly specialize in transactions well below 50 euros.

Other red flags included the use of private loans linked to others with ties to underground banking, and connections to an industrial site known as the Midi Center, which is opposite the Bazaar in Beverwijk. The Midi Center has a connection to one man in his thirties from Afghanistan who is tied up in a court case involving allegations of laundering hundreds of millions of euros and the provision of banking services to the criminal underworld.

The four business owners themselves all are either from Afghanistan or are Dutch-Afghan. A similar ongoing investigation has focused on Dutch-Afghan businessman Davoud Quadri. The rapid expansion of his Q&Q Tabak en Souvenirs retail stores in Amsterdam raised eyebrows during the coronavirus pandemic.

Three of his shops were closed this week, all of which are located on Damstraat. A fourth is in danger of closing, a fifth closed but reopened under new ownership, and a sixth remains unable to open while its permit application is reviewed.

Six of Quadri's stores were forced to close for six months last year after investigators accused them of illegally selling hemp joints. Four more were closed in the past.

In an op-ed published by The Guardian on Friday, Halsema warned that money earned from illegal drug trafficking and organised crime was being subversively invested in property, commercial services, and hospitality businesses. "If it continues on this current path, our economy will be inundated with criminal money and violence will reach an all-time high," she added.

As part of the city's goal to tackle organized crime, the city tightened up business permit rules for retail businesses operating along one city center roadway, that breaks up into Damstraat, Oude Doelenstraat, Oude Hoogstraat, and Nieuwe Hoogstraat. The area sees a heavy amount of foot traffic, but the variety of shops there is of questionable quality while rental prices and property sales prices are extremely high.

Six applications under the new permit scheme have already been rejected.