Legal rules and formalities play a significant role in the profession of art dealers say Thomas J Salzano a popular antiquities dealer and a blogger. To work as an antiquities dealer you need to be familiar with the frequently changing rules and regulations by the government.
The recent hot topic of antiquities dealers like Thomas is the “Implications for Art Dealers in Anti-Money Laundering Provisions of the National Defense Authorization Act of 2021.”
Let’s discuss this in detail to understand what the Act says:
On January 1, 2021, the U.S. Senate joined the House in voting to override President Trump’s veto of the National Defense Authorization Act for Fiscal Year 2021. This included the provisions that will have significant implications for the antiquities market and dealers. This will have an impact on the art market as well.
The AML provisions in the NDAA 2021 highlights:
- Section 6110 of the NDAA expands the scope of the U.S . Bank Secrecy Act (BSA) to people engaging in the trade of antiquities, including consultant, an advisor, or any other person who engages as a business in the solicitation or sale of antiquities.
- The financial institutes that are covered by the BSA, which will now include antiquities traders, must meet certain reporting, record-keeping, and other AML compliance requirements.
- After the law is fully implemented, the antiquities traders will face potential criminal and civil penalties for AML compliance lapses, just like, casinos, banks, precious metals traders, and other covered entities by financial institutions.
- The section 6110 directs the Department of Treasury and DOJ to conduct an assessment of the ways in which the art trade facilitates terror financing and money laundering and to suggest to Congress the degree to which the art market should be subject to AML regulations.
- The Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) will maintain beneficial ownership data in a confidential registry. This will be available to financial institutions if the customer of the institution consents.
BSA Requirements for Antiquities:
As per Section 6110, FinCEN, which administers the BSA, will need to promulgate implementing regulations by the end of 2021. This regulation will include the details about which transactions are covered and what is required.
Once FinCEN proposes implementing regulation the interested parties will be afforded an opportunity to comment, and FinCEN will address those comments in its final rulemaking.
Thomas J Salzano feels that these limitations may make it difficult for antiquities traders, and impossible for art dealers, to use the registry to facilitate AML due diligence. But we shall wait for the final implementation as this is important for security to address growing international criticism that U.S registration requirements permit criminals to hide behind shell companies and other opaque structures.