Page:2020-07-29 PSI Staff Report - The Art Industry and U.S. Policies that Undermine Sanctions.pdf/39

 2018. This directive compels businesses selling art to verify the identity of customers before completing transactions of €10,000 or more. Under the directive, European Union member states were required to implement this new requirement by January 10, 2020. The United Kingdom adopted similar rules in the weeks before its exit from the European Union on January 31, 2020. The United States has yet to follow suit.

2. The Art Industry is the Largest Legal, Unregulated Market in the United States

Today, the art industry is considered the largest legal, unregulated industry in the United States, permitting purchasers to buy pieces without any record of the transactions, even when large amounts of cash are involved. In effect, buyers and sellers can remain anonymous raising the concern that corporate veils are being used "to manipulate markets, evade taxes, [and] launder money." Illegal activity, including money laundering, in the art market is made possible, in part, because the art market is generally not subject to the transparency requirements of the Bank Secrecy Act ("BSA"). The BSA was enacted by Congress in the 1970s to protect the United States from money laundering and corruption by imposing transparency requirements on many types of cash transactions. It includes "requirements for reporting, customer identification and due diligence, recordkeeping, and the establishment and maintenance of BSA/AML compliance programs." The BSA's reporting requirements mandate, for example, that financial institutions file suspicious