Page:2020-07-29 PSI Staff Report - The Art Industry and U.S. Policies that Undermine Sanctions.pdf/40

 activity reports ("SARS") regarding "any suspicious transaction relevant to a possible violation of law or regulation." In addition to SARS, Currency Transaction Reports ("CTRs") must be submitted for "individuals transporting large amounts of cash internationally, persons with large foreign financial interests, and nonfinancial entities conducting large cash transactions."

The art industry in the United States is not required to comply with the requirements of the BSA. Art dealers in the United States continue to operate without any regulated or structured mechanisms for transparently buying or selling art, including mandatory systems for the declaration or transfer of ownership. Moreover, insider-trading rules applicable to the commodities market do not apply to art, allowing collectors to buy works of art based on privileged information. In addition, "there is currently no regulation that specifically targets money laundering in the art market, nor does the art market itself subject professional art intermediaries to any standards of professionalism that directly address money laundering." The lack of regulatory requirements or voluntary industry-wide standards in the United States means "art dealers have little incentive other than good faith to flag possible money laundering schemes involving artwork for law enforcement."

Despite the weaknesses in U.S. AML safeguards for the art market, participants in the art industry may be subject to other restrictions including: import and export regulations; cultural property regulations; data protection and privacy laws; state anti-money laundering laws; tax regulations; and local auction regulations. If they buy or sell art outside of the United States, they may also be subject to non-U.S. anti-money laundering controls.