100 years of the Vereniging van Effectenbezitters (VEB)
Today is a memorable day for the VEB, the interest group for investors and securities holders in the Netherlands. It was founded in The Hague exactly 100 years ago under the name Vereniging Effectenbescherming (Association of Securities Protection). On its centenary, it receives the ‘Royal’ designation.
It is no coincidence that the VEB was founded in 1924. The period just after the First World War was a turbulent time in Europe. The communists took power from the Russian tsar in 1917, and in the years that followed both the Austro-Hungarian and Ottoman Empires fell while Germany, the loser of the war, fell into a major economic crisis. For investors in the Netherlands, who had originally invested abroad, this had major consequences. Many countries and companies in Eastern Europe were no longer able to meet their obligations. And the new Bolshevik regime in Russia was the king of them all. Shortly after the October Revolution, they declared all foreign investments to be invalid. This resulted in an estimated 1.5 billion guilders in Russian investments going up in smoke.
Attempts from politicians in The Hague and special committees from the Vereniging voor de Effectenhandel (Amsterdam Stock Exchange Association) only served to demonstrate to investors that they were powerless to repair the damage suffered. This is why investors in The Hague united in the VEB in 1924, despite a similar interest group already being founded in Amsterdam under the name Vereniging van Fondsenhouders two years earlier. The fact that two separate investor associations emerged side by side is due to there being two separate stock exchanges in Rotterdam and The Hague in addition to the one in Amsterdam. The Vereniging van Fondsenhouders was merged into the VEB in the 1950s. But they were still unable to recover any of Russia’s large debt. To this day, nothing has ever been seen of the lost money.
In 1987, the VEB changed its name: since the abbreviation no longer stood for Vereniging Effectenbescherming, but for Vereniging van Effectenbezitters [Association of Securities Owners]. It was also around this time that the VEB acquired its new role as a fighter for investors’ interests. In 2024, as the VEB turns 100 years old, it is beloved by its approximately 30,000 members. And this should come as no surprise; after all, it has collected billions of Euros in compensation for its members in recent years through collective legal actions against listed companies. And because exchange sector laws and regulations are increasingly being drawn up in Brussels, and investing is a cross-border activity, they are now increasingly focusing on Europe. At 100 years old, the VEB will now do this under the distinguished title of Royal European Investors/Koninklijke VEB.
