Money Laundering Directive 5 What does it mean for the art trade? - PowerPoint PPT Presentation

Money Laundering Directive 5 What does it mean for the art trade? Mathilde Heaton, Art Law Advisory 4 September 2018

Overview – AML & the Art Trade • Current position ? • What is new ? • What does it mean for the art trade ? The Responsible Art Market Initiative (RAM) 4 September 2018

Money Laundering Regulations 2017 High Value Dealers = Cash transactions ≥ € 10,000 / £ 9,000 Risk-based AML measures • Risk assessments • Policies, procedures and controls • Customer due diligence • Record keeping and reporting • Staff training 4 September 2018

MLD 5 - What is new for the art trade ? • Art galleries, auction houses, freeports, dealers, art advisors = “obliged entities” • Transactions ≥ € 10,000 / £ 9,000 regardless of payment method used i.e. credit card, bank transfer, cheque or cash Katsushika Hokusai, Under the Wave off Kanagawa “ persons trading or acting as intermediaries in the trade of works of art, including art galleries and auction houses..” 4 September 2018

MLD 5 – Timeline & Brexit ? Jan 2020 May 2018 Implementation MLD 5 adopted date for MLD 5 29 March 2019 Brexit day 4 September 2018

Jan 2020 ? 4 September 2018

What is the Responsible Art Market Initiative (RAM)? • Not for profit, cross-industry initiative • Foster dialogue & debate • Practical tools & guidelines • Public consultations, annual conferences 4 September 2018

Projects to date… 2018 2017 4 September 2018

Guidelines on countering money laundering & terrorist financing risks Red flag lists Quick Country Reference Guidelines • Client Guides Guide • Artwork • Transaction Risk-based approach Risk-based approach 4 September 2018

4 September 2018

AML country guides Europe Americas France • Asia Germany • • USA • India Luxembourg • • Argentina UK • • Brazil Switzerland • 4 September 2018

Art Transaction Due Diligence Toolkit • An aide-mémoire • Non-exhaustive • Use with risk-based approach • No uniform standard • Read with the Explanatory Notes 4 September 2018

Example Red Flags 4 September 2018

Final thoughts • Review AML practices & procedures now • Implement risk-based AML measures • Be alert to “Red Flags” & “trust your gut" 4 September 2018

Questions ? Thank you http://responsibleartmarket.org/ 4 September 2018