In recent weeks it has come to light that some art businesses may have misunderstood, and unknowingly be breaking, a key part of the latest anti-money laundering regulations.
We were therefore more than happy to oblige when we were asked to contribute to artnet news’ latest feature to shed some light on the matter: UK Art Dealers Are Misusing the Law to Avoid New Money-Laundering Regulations. Compliance Experts Say It Will Backfire.
The confusion stems around the topic of ‘reliance’. While in some transactions the rules allow AMPs to rely on CDD checks carried out by a third party, many are thought to be leaning on “reliance” as a way to avoid disclosing the identity of their clients:
“They tell you, ‘I have checked my client, and they’re okay’ – they don’t reveal the collector’s name, and the deal proceeds. The problem is: that’s not how reliance works.”
-Susan J Mumford, ArtAML CEO & Co-Founder
This is not only a dangerous misinterpretation of the rules, those found doing this could face fines – or even jail time.
So if you’re under the impression that using reliance for your AML obligations will lessen your burden, think again – the consequences could be severe.
Read the full piece via artnet news – with thanks to Naomi Rea for the feature.