The Illicit Art and Antiquities Trafficking Prevention Act proposed in the US Congress in May is in limbo after the November mid-term elections.
But a spate of new anti-money-laundering initiatives worldwide could prompt Washington to revive efforts to tighten up on trade-based financial crime in the art and antiquities sectors.
These sectors are vulnerable to trade-based money launderers for several reasons. Unlike most goods and commodities, art and antiquities have no set market value and prices are often subjective which opens up substantial opportunities for launderers.
Also, art and antiquities tend to be high value and the market is huge which means that it is relatively easy to move large sums of money without an illicit transaction being noticed.
A recent Deloitte study reckons that art and antiquities owned by high-net-worth individuals will grow from an estimated US$1.62 trillion in 2016 to US$2.7 trillion by 2026.
Legislators in Washington may be motivated to revive the proposals for the proposed act in Congress in January 2019 by high profile trade-based money laundering cases such as the US$2bn letter of credit and letter of understanding frauds allegedly perpetrated in India by celebrity jeweller Nirav Modi in cahoots with Punjab National Bank officials.
Lawmakers may also note that the use of high-value UK properties, many of which are in London, in money laundering schemes are being restricted. Britain said that from 2019, it will end its so-called golden visa scheme that provided residency rights for the super-rich but has been heavily criticised for providing an easy way to launder stolen wealth.
Now, it seems as though the super-rich will have to find different ways to shift large amounts money if it has been illicitly earned and the art and antiquities trade may appear an attractive alternative.
Categories: Trade Based Financial crimes News