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Congressional probe: Russian oligarchs using U.S. art market to evade sanctions https://www.politico.com/news/2020/07/29/probe-russian-oligarchs-evade-art-sanctions-386154
The Permanent Subcommittee on Investigations traced $18 million in high value art purchases from US auction houses & private sellers back to 3 shell companies linked to Russian construction and energy tycoons Arkady and Boris Rotenberg.
The Rotenbergs, who were sanctioned in 2014, used three shell companies to buy the art after they were sanctioned, and “attempted to conceal their participation in the U.S. art market by hiding behind a Moscow-based art advisor and dealer, Gregory Baltser.”
Sanctioned Russian oligarchs using U.S. auction houses to launder?
Nothing to see here, say @Sothebys and @ChristiesInc:
Nothing to see here, say @Sothebys and @ChristiesInc:
The Congressional report unpacks how easy it is to defeat the art world's "lax and voluntary anti-money laundering controls":
Sen Rob Portman:
“Art is a very significant piece of very wealthy people’s investment portfolios [that they] can use to hide, store and move money around the world."
"If the art market is seen as a place where it’s easy to launder dirty money, then it will attract criminals.”
“Art is a very significant piece of very wealthy people’s investment portfolios [that they] can use to hide, store and move money around the world."
"If the art market is seen as a place where it’s easy to launder dirty money, then it will attract criminals.”
The panel is recommending Congress amend the Bank Secrecy Act to add businesses handling transactions involving high-value art — the art industry is not currently subject to anti-money laundering laws under the Act.
A much needed reform...
A much needed reform...
Here is the full bi-partisan report from the Permanent Subcommittee on Investigations, which has important detail on the flaws with the major auction house voluntary anti-money laundering policies:
https://www.hsgac.senate.gov/imo/media/doc/2020-07-29%20PSI%20Staff%20Report%20-%20The%20Art%20Industry%20and%20U.S.%20Policies%20that%20Undermine%20Sanctions.pdf
https://www.hsgac.senate.gov/imo/media/doc/2020-07-29%20PSI%20Staff%20Report%20-%20The%20Art%20Industry%20and%20U.S.%20Policies%20that%20Undermine%20Sanctions.pdf
The report makes clear the auction houses @ChristiesInc and @Sothebys were ACTIVE PARTICIPANTS in the Baltser laundering scheme:
This is stunning:
Christie's agreed to the Baltser scheme.
Sotheby's declined, but did business with knowing his clients were the Rotenbergs.
Sotheby's employee later said "she fabricated this information in an effort to convince Sotheby’s to accept BALTZER’s proposal."
Christie's agreed to the Baltser scheme.
Sotheby's declined, but did business with knowing his clients were the Rotenbergs.
Sotheby's employee later said "she fabricated this information in an effort to convince Sotheby’s to accept BALTZER’s proposal."
Why did the Sotheby's employee claim her previous statements about the Rotenbergs was a lie?
If Sotheby's and Christie's knew Baltser was a front for the Rotenbergs and continued doing business with him after the 2014 sanctions... they would be knowingly violating federal law.
If Sotheby's and Christie's knew Baltser was a front for the Rotenbergs and continued doing business with him after the 2014 sanctions... they would be knowingly violating federal law.
