Art World: “Panic. Absolute Bloody Panic”
Can the art world clean up its act? In the secretive art market, new anti-money laundering legislation has landed like a bomb.

Jan Dalley reports:  A senior gallerist is describing the first reaction of fellow members of the Society of London Art Dealers to new regulations to combat money laundering in the art market. I’m hardly surprised: even after 15 years of covering the art world as a journalist, I’m often amazed by its peculiar codes and customs, still substantially based on relationships, private agreements and trust.

But this old-school way of doing things, which provides a climate ripe for exploitation by the unscrupulous, is under challenge from the modern world. There has long been concern over the ease with which suspect funds can be laundered through the buying and selling of art. Now, at last, we are seeing a concerted attempt to get to grips with the issue, which — even if welcomed by most — has sparked resentment and wariness. This almost unregulated sector doesn’t take easily or kindly to attempts to legislate it. What we do not know is whether the EU initiative — the fifth Anti-Money Laundering Directive, which spread the net to include luxury goods, property and the art market, and which became law in the UK in January — will prove equal to a problem some have considered intractable.

The art trade seems almost ridiculously tailor-made for money laundering — because of the value of some pieces, because they are usually easily portable, and most of all because of the cult of secrecy that holds sway in the sector. There’s nothing inherently wrong with secretiveness; there can be valid and innocent reasons for it. But there’s clearly room for subterfuge. At least 50 per cent of all art transactions are entirely private and handshake deals are still common; even in the auction houses, which appear to be so public-facing, the price may be disclosed but the identities of both buyer and seller are often guarded to the grave.

Perhaps most significantly of all, there is no registration of ownership of artworks, as there is with shares or property — we don’t know for certain where even some of the most famous pictures are held, or who in fact owns them. Take Van Gogh’s “Sunflowers”, one version of which sold in 1987 for a then spectacular $39.9m to a Japanese buyer (or possibly his company): does anyone know where it is now? …..FT.com
Financial Times: @FT

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One issue that’s been in the headlines for many years is anti-money laundering (AML). When criminals are able to successfully hide the illicit origins of their cash, both the financial institution and society suffer.

Why AML Should be a Top Priority for Financial Institutions

The to-do list for any financial executive is surely daunting. From navigating technology changes to managing talent effectively, there’s many initiatives competing for attention.

One issue that’s been in the headlines for many years is anti-money laundering (AML). When criminals are able to successfully hide the illicit origins of their cash, both the financial institution and society suffer. So, what makes AML more important now than it has been in the past?

Rising up the Priority Ladder

Today’s infographic from McKinsey & Company explains the factors which have brought anti-money laundering urgently to the forefront in recent years.

1. Regulatory Action

Enforcement actions related to AML have been on the rise. Since 2009, regulators have levied approximately $32 billion in AML-related fines globally.

2. Threat Evolution
Criminals are using more sophisticated means to remain undetected, including globally-coordinated technology, insider information, and e-commerce schemes.

3. Reputational Risk

AML incidents put a financial institution’s reputation on the line. There’s a lot at stake: today, the average value of each of the top 10 bank brands is $45B.

4. Rising Costs

Most AML activities require significant manual effort, making them inefficient and difficult to scale. In 2018, it cost U.S. financial services firms about $25.3B to manage money laundering risk.

5. Poor Customer Experience

Compliance staff must have multiple touch points with a customer to gather and verify information. Perhaps not surprisingly, one in three financial institutions have lost potential customers due to inefficient or slow onboarding processes.

It’s no wonder anti-money laundering has now become a top priority for many CEOs in the financial industry.

A Wave of Innovation

In the last five years, there has been an explosion of “RegTech” startups—companies that address regulatory requirements using technology.

Jenna Ross reports:  Visualcapitalist.com

A number of factors in recent years have brought anti-money laundering to the forefront for banks and other financial institutions. In this infographic, we explore the various trends, and then look at how innovations in technology are offering new ways to address AML challenges in areas such as customer onboarding, transaction monitoring, and management oversight. In conclusion, we look at how investments in AML can create competitive advantages for financial institutions.
Why AML should be a top priority for financial institutions PDF/ Download

[click here to enlarge infographic]