You raise a valid point. However we do not know that he has been extradited. In fact, I drew quite a different conclusion.
Holland is telling his story, in great detail, to some unidentified compatriot. The implication is that the money has run out, and now impoverished, he wants to make a clean breast of it and is confessing to -- whom? Well quite possibly some member of the British Embassy staff. And why? Well we are told several times that Holland is unimaginative and it seems that the most he can imagine is frittering away all his ill gotten gains in a year of super rich high living. He could have invested the money in his adopted country, but he prefers to just have one party after another, and to be ridiculously generous. It is just a neat way of tying up the ending.
Also, do bear in mind that this was 1951 and films in general and Ealing comedies in particular were tied to a strict moral code in which the protagonist could never be seen to get away with a crime. It is left to our imagination, but the implication is that Holland, having nearly spent all his cash makes a telephone call and 'hands himself in'. It's not a very likely scenario, but one required by the filmmakers' ethics of the day. And it is satisfying if we draw the conclusion that Holland could not imagine how he could continue, and anyway didn't want to go on living in Rio under any other basis; i.e. on an ordinary income.
Remember too that this was England in the 1940s, early 1950s. The public conception of prison in those days was that it was an easy life, free from responsibilities. No one heard of the sexual abuse and bullying that was rampant in British penal institutions. Holland would, presumably, do his 'bird', pay his debt to society, perhaps even do some work in the prison workshops, or library or whatever, then he would be released and probably live out his days on a pension, but carrying the fond memories of his year in the sun. Perhaps he would sell his story to the 'News of the World'? I can imagine all kinds of future scenarios, and that is what makes the ending, for me, quite satisfying.
Now a remake could have him getting away with a substantially higher sum and living in luxury for the rest of his life. That is possible in this day and age because we no longer have the moral imperative of immediate post-war Britain. But for me, the present ending is satisfying, and does fit with Holland's personality.
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