Financial Crimes Task Force Report Cited in Harvard Fellow’s Art Market Analysis
February 8, 2021
The Antiquities Coalition’s Financial Crimes Task Force Report was cited in an art market analysis by Michael B. Greenwald, a Fellow at the Harvard Kennedy School’s Belfer Center for Science and International Affairs.
“The Art Market’s Next Inflection Point,” published on the Belfer Center’s website on February 8, opened by examining how the American art market’s “traditional culture of anonymity and opaque valuations process”—which Greenwald described with more detail in a previous analysis—has historically discouraged any increase in regulations. The ensuing lack of market protections made the American art world a playground for bad actors like the Rotenbergs, enabling a wide range of financial crimes.
Congress took a major step to resolve this dilemma on January 1 by passing the National Defense Authorization Act for Fiscal Year 2021 (NDAA), which removed antiquities dealers’ exemption from otherwise standard anti-money laundering (AML) laws and regulations under the U.S. Bank Secrecy Act (BSA).
However, as Greenwald observed in his analysis, the NDAA’s enhancement of the BSA will not result in significant improvement automatically.
“Though it certainly draws awareness to the problem and holds the art market under the same standards as the other industries and entities listed above, it does not create any new bodies to enforce these regulatory measures,” Greenwald wrote. “As a result, what we are left with is a step in the right direction, however there is much more ground to cover.”
Greenwald then drew attention to the Antiquities Coalition, noting that we have “taken a strong stance against criminals exploiting the American art market” and, through our Financial Crimes Task Force Report, made “several strong recommendations to improve existing regulation and strengthen the new declaration in the BSA.”
He highlighted a few of the Financial Crimes Task Force Report’s recommendations, in particular, that “focus on long term education processes and the appointment of high-level officials”—and, as such, hold the potential to have “substantial, lasting impact on corrupt wealth moving through art.”
As Greenwald moved to wrap up his analysis, he wrote that the U.S. Treasury needs to issue additional regulations for antiquities and conduct a risk assessment on the art sector.
“Without the institution of concrete actions and regulatory bodies following up on this legislation, the art loophole will continue to exist,” Greenwald concluded. “Cooperation between the private and public sectors will be necessary if we want to continue squeezing the stream of illicit funds that travel across the globe. Just as gold and cash are stores of wealth, we need to remember that art has a similar function—when it comes to money laundering and terrorism, it must be treated as such.”
To access the full Financial Crimes Task Force Report, including all 44 of its recommendations, click here.