Own Art’s AML-Worthy Works to Watch

As we all know, the EU ‘Anti Money Laundering Directive 5’ (AMLD5) came into force on 10 January 2020, with HMRC in charge of implementing this in the UK. For the first time, HMRC has classified Art Market Participants (AMPs) as a specific sector that will need to comply with these regulations. This is because AMLD5 now categorises artworks as ‘High-Value Goods’ (HGVs) that carry a potential risk for money laundering.

This means that anyone in the EU selling art above a certain threshold will need to take necessary steps and records to prevent money laundering.

“But does this affect me?”, I hear you ask…

There’s a reason why Own Art partnered with ArtAML – to ensure that our member galleries stay informed and up to date with Anti-Money Laundering (AML) regulations. Own Art is here to support our network of galleries in any way we can, so naturally, we always keep an eager eye on the fantastic artworks they sell. Did you know that there are a number of Own Art member galleries that sell artworks exceeding the AML benchmark of approximately £8,600? These galleries are known as Art Market Participants (AMPs), to whom this new legislation directly concerns.

We’ve selected a few artworks from some Own Art member galleries that reach this benchmark, so when these beautiful pieces are sold, the gallery and staff must comply with AML regulations and ensure they are carrying out the correct checks. 

LIKE AND SUBSCRIBE, 2019 by Ralph Anderson at JGM Gallery – £12,000
Canopy Conference by Paul Wright at Thompson’s Galleries – £11,000
Between the Islands I by James Byrne at Reuben Colley Fine Art – £10,000 ex vat / £12,000 inc vat
Paris Janvier, 1931 by Jacques-Henri Lartigue Rene at The Photographers’ Gallery – €12,000 + VAT
Memories – Poppy Wall Installation by Peter Layton at London Glassblowing – £12,000
Light Within by Sarah Harvey at New Blood Art – £14,000
Twilight Sardine Landing by Henrietta Graham at Mall Galleries – £18,000
Orkney Painting 1 by Trevor Sutton at Zuleika Gallery – £10,000
Excess Baggage by Ian Rayer-Smith at Soden Collection – £15,600
Swoon by Zahra at Hang-Up Pictures – £20,000 – £40,000

One key component of anti-money laundering (AML) legislation involves Know Your Customer (KYC) requirements. Know Your Customer or Know Your Client is exactly what you would assume: guidelines that require your business to verify the identity, suitability and acknowledge the risks involved with maintaining a business relationship prior to the purchase being made.

To make it simple, there are three elements of KYC you must consider.

  • A Customer Identification Program (CIP).
  • Customer due diligence (CDD).
  • Ongoing monitoring at regular intervals, often annually.

It is completely up to you whether you would like to handle this internally or externally, as there are a number of fantastic third-party services that can help simplify your AML compliance. One of which is, of course, our friends at ArtAML, who are offering their services to Own Art members for 14 months for the price of 12. This offer is valid through to the end of March 2022.

The use of service providers like ArtAML can help streamline the process and focus resources where they’re needed i.e. Identity verification, credit checks, and manual inspection of documents, so you can relax that little bit more.

The acronyms can be a lot, so here’s a list for your reference:

  • AML – Anti-Money Laundering
  • AMLD – Anti-Money Laundering Directive
  • CDD – Customer Due Diligence
  • CRO – Chief Risk Officer
  • EDD – Enhanced Due Diligence
  • KYC – Know Your Customer
  • SAR – Suspicious Activity Report

If you ever feel like you need some retraining, Creative United’s AMLD5 and the Art Market training programme is available for free on Learnworlds and delivery partner Kingsley Napley created an extremely useful AMLD5 Toolkit especially for your reference.

Think you know your AML regulation? Take this quiz and test yourself!