A Wall Street Journal op-ed calls for sensible art market regulations but relies on some money laundering fairy tales
This commentary by Marion Maneker is available to AMMpro subscribers. (The first month of AMMpro is free and subscribers are welcome to sign up for the first month and cancel before they are billed.)
The Myth of the Money Laundering Art Market
With apologies for beating a dead horse, it is time to wade once again into the issues surrounding the art market and international money laundering. The occasion for our latest foray is William G. Rich’s opinion piece in the Wall Street Journal which is a perfectly reasonable idea justified with a load of nonsense.
The good news is that Rich is pushing for the art market to keep better records of the beneficial ownership of works of art over a certain value. One might reasonably and sensibly suggest that such record-keeping is necessary for works of art worth above one million dollars. The Treasury department has successfully imposed similar rules for the sales of luxury homes and condominiums in US cities where real estate was becoming an obvious conduit for money laundering. There is no evidence that art is being used to launder money, despite the penchant for claiming it is, but that’s probably as good a reason as any to do the record keeping.
The most clear-cut case of art being used to launder money by a criminal is Edemar Cid Ferreira, a Brazilian banker who had committed fraud in his own country. With the illicit money he received from the fraud, he bought a lot of art which he secretly moved to the United States. There he was storing it to be turned into cash at a later date, if necessary. That day never came. Edemar Cid Ferreira never sold his art in the US. It was seized there.
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