UPDATE 2-Head of Dutch KPMG quits after investigations

Mon May 12, 2014 11:13am EDT

(Adds background on previous case)

AMSTERDAM May 12 (Reuters) - The head of KPMG in the Netherlands resigned on Monday, the accounting firm said, less than a month after authorities launched a criminal investigation into alleged tax fraud at a venture it set up to build a new Dutch headquarters.

Jurgen van Breukelen, who was in the position for less than two years, said he was stepping down to enable the company to break from "the recent past of misjudgments and errors".

Last month, Dutch authorities said they had launched a criminal investigation into the joint venture between KPMG and a project developer, including the role of two unidentified executives.

It is the second time in less than a year that authorities have investigated alleged wrongdoing at the Dutch operations of KPMG, which makes much of its business from auditing the accounts of other companies.

In December, KPMG said prosecutors had been investigating three former accountants at KPMG Accountants NV and that it had settled with authorities for 7 million euros ($9.63 million).

A KPMG spokesman said van Breukelen was not among those people being investigated, but that one was a former KPMG partner. Prosecutors were not immediately available to comment.

Van Breukelen's "role and effectiveness in leading the firm through these issues and the probes has been hampered by the fact that attention has focused on his personal situation and personal role", said the spokesman, Eric Bouwmeester.

Dutch prosecutors said last month they suspected the joint venture set up to develop of the new Dutch HQ was used to boost costs in tax filings to Dutch authorities with the aim of reducing taxable income.

"The project developer is also suspected of fake billing. This may have led to millions of euros in avoided taxes," the prosecutors said in a statement.

As part of the investigation, the prosecutors searched several KPMG sites and two private homes. ($1 = 0.7269 Euros) (Reporting By Anthony Deutsch; editing by David Goodman and Tom Pfeiffer)

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