Latest AC Story Map Details How Russian Billionaires Evaded Sanctions Using the U.S. Art Market
October 21, 2020
October 21, 2020
After Vladimir Putin directed the Russian military to invade Ukraine in 2014, the United States government imposed heavy sanctions on Russia, explicitly targeting his inner circle. How, then, did two members of that circle—Russian construction and energy magnates Arkady and Boris Rotenberg—allegedly manage to launder no less than $18 million right under the U.S. government’s nose?
We at the Antiquities Coalition answer this question in our latest story map release, Oligarchs, Offshores, and the Olympics: A Case Study in How Criminal Misuse of the Art Market Undermines U.S. Sanctions.
As it turns out, according to a 150-page report released by the U.S. Senate’s Permanent Subcommittee on Investigations (PSI) back in August, the Rotenberg brothers exploited the $28.3 billion U.S. art market, referred to in the PSI report as “the largest legal, unregulated market in the United States.”
Our Story Map explores all the gears in this criminal machine, including the shell companies used to transfer money from around the world and the art consultant deployed on the Rotenbergs’ behalf to engage in dubious transactions. Masterpieces ensnared by the Rotenberg enterprise include “Brücke II” by Lyonel Feininger, “La Poitrine” by René Magritte, “Ombre d’Espace” by Jean-Paul Riopelle, and “Un Port sous la Lune” by Tamara de Lempicka.
The bottom line is that U.S. sanctions can be easily sidestepped so long as the U.S. art industry lacks regulations and remains exempt from the Bank Secrecy Act, the country’s main anti-money laundering law, which requires high-risk industries to assist the U.S. government in preventing and detecting financial crimes. Even the PSI has recommended that Congress “amend the BSA to add businesses handling transactions involving high-value art.”
As Antiquities Coalition Founder and Chairman Deborah Lehr stressed while reflecting on the PSI report in an August op-ed for The Hill, “For our national security and global standing, we must add the multibillion-dollar art industry to the community of private-sector combatants in the battle against money-laundering and terrorist financing.”
The Antiquities Coalition’s Financial Crimes Task Force has also called for Congress to “explicitly apply the Bank Secrecy Act (BSA) to dealers in cultural property,” in what was just one of 44 recommendations devised by our diverse group of experts to help guide the U.S. government, the U.S. financial industry, the U.S. art and antiquities sector, and the international community in keeping financial crimes out of the U.S. art market.
For more information about the Financial Crimes Task Force and its recent report, click here.
About the Antiquities Coalition
The Antiquities Coalition unites a diverse group of experts in the international campaign against cultural racketeering, the illicit trade in art and antiquities. This plunder-for-profit funds crime, conflict, and violent extremist organizations around the world. By championing better law and policy, fostering diplomatic cooperation, and advancing proven solutions with public and private partners worldwide, the Antiquities Coalition empowers communities and countries in crisis to safeguard cultural heritage for future generations.