The US Congress is cracking down on money schemes in the art market

The US Congress is cracking down on money schemes in the art market

The U.S. Congress has passed the bipartisan Art Market Integrity Act to stop criminals from laundering money through the $25 billion art market.

Surprisingly, efforts to stop money laundering have shown a big hole in our financial system: the luxury art market, where criminal groups like Latin American cartels, terrorist financiers, and sanctioned Russian oligarchs launder billions of dollars every year. We have known about traditional ways to wash money for a long time, but the art world has mostly not been regulated, which is a recipe for illegal financial activity.

The new "Art Market Integrity Act" is a big step forward in the fight against money laundering. This law is different from past attempts to regulate art transactions because it focuses on high-value transactions and requires dealers and auction houses to put in place strong anti-money laundering measures. These rules also try to close a big loophole that criminals have been using to avoid punishment and hide the money they make from illegal activities. The law will give police the tools they need to break up the financial networks of dangerous groups that are now taking advantage of the art market's lack of privacy.

Both sides of Congress agree on a bill to stop money laundering in the art market.

On July 23, 2025, a historic bipartisan group in the U.S. Senate put forward a bill to close one of the biggest holes in America's financial regulations. Senators John Fetterman (D-PA), Chuck Grassley (R-IA), Sheldon Whitehouse (D-RI), Bill Cassidy (R-LA), Andy Kim (D-NJ), and David McCormick (R-PA) officially introduced the Art Market Integrity Act (AMIA). It wants to stop illegal money from moving through the art world.

The law adds Bank Secrecy Act rules to the U.S. art market, which is worth $25 billion and doesn't have any rules against money laundering right now (source). Grassley, the chairman of the Senate Judiciary Committee, said, "For decades, criminal organisations have used America's multibillion-dollar art industry as a personal piggy bank for money laundering schemes, terrorist financing, and other bad things" (source).

The bill has smart exceptions for small businesses that only do less than $50,000 worth of art business each year and for businesses that don't do any one transaction worth more than $10,000 (source). Also, these rules don't apply to artists who only sell their own work (source).

The law makes the rules in the US the same as those in the UK, EU, and Switzerland (source). This keeps the U.S. from becoming a safe haven for criminals. Recent high-profile cases have shown that we need to make changes right away. Nazem Ahmad, a financier for Hezbollah, laundered more than $160 million (source). Arkady and Boris Rotenberg, two Russian oligarchs, moved $18 million through art sales to avoid sanctions (source).

Politicians talk about how criminals make money by selling art.

Image Source: ICIJ, the International Consortium of Investigative Journalists

Criminals have learned that the art market is a great place to steal money. Some estimates say that more than $3 billion worth of art is sold each year in connection with suspicious activity (source). This exploitation happens because the market has unique weaknesses, such as privacy rules, third-party middlemen, and subjective methods of valuing things.

A Senate investigation in 2020 found that Russian oligarchs Arkady and Boris Rotenberg got around US sanctions by buying expensive art worth $18.4 million through middlemen (source). The brothers paid $6.8 million for several pieces of art at a Sotheby's auction in New York. They hired an art consultant in Moscow to help them buy the pieces, which included works by Moore, Chagall, and Braque (source).

The Financial Action Task Force (FATF) says that drug trafficking, corruption, and other financial crimes are the main sources of the money that is laundered through art (source). Also, terrorist groups sometimes work with criminal groups to steal and smuggle cultural artefacts out of war zones (source).

Investigations are still hard, though, because law enforcement doesn't know much about art markets and cross-border transactions are hard to figure out (source). It's especially scary that criminals might use the global art market to wash about $100 billion in illegal profits every year (source). The underground art market, on the other hand, makes up to $6 billion a year (source).

New compliance rules are supposed to fill in the gaps.

The Art Market Integrity Act changes the way the art world works by making it harder to follow the rules. Dealers, galleries, auction houses, museums, and advisors are all middlemen in the art market. They must now follow strict anti-money laundering rules (source). These groups will soon have to follow the same rules as banks and jewellers. This means that they will have to do background checks on customers, keep detailed records, and tell the police about any suspicious activity (source).

The law makes sure that smaller businesses aren't overwhelmed by setting clear limits. Businesses that do less than $50,000 worth of art transactions each year or that do not do any one transaction worth more than $10,000 do not have to pay taxes (source). People who sell their own art don't have to follow any extra rules either (source).

The Act makes American laws the same as those in the UK, Switzerland, China, and the European Union (source). This harmonisation stops regulatory arbitrage, which used to let criminals take advantage of differences in the law (source).

Fines for breaking the rules are big. For instance, anyone who breaks the law could be fined up to $100,000 for each transaction (source). If you break the law on purpose, you could spend up to five years in jail and pay fines of up to $250,000 (source). If banks or other financial institutions break the rules, they could face fines up to $1 million per violation (source).

The law now closes a big regulatory gap that used to let the $25 billion American art market, which is the biggest legal unregulated industry in the country, get away with things (source).

Last Thoughts

The Art Market Integrity Act is a big step forward for the US's financial security. This bipartisan bill fixes a big problem that has let billions of dollars in illegal money go unnoticed during high-value art sales. The law mostly puts the $25 billion art market under much-needed regulatory control while carefully balancing the needs of businesses with the needs of compliance. The fact that smaller dealers, transactions under $10,000, and individual artists are not covered shows that lawmakers understand how different the industry is.

When you think about how much exploitation there is—about $100 billion is laundered every year through art markets around the world—you can see why this law is needed. In the past, criminal groups, people who paid for terrorism, and people who were on the list of people who could be punished could do whatever they wanted in this regulatory blind spot. So, the big fines that are now in place really do stop people from doing these things.

This law is the most important because it makes American standards the same as those in Europe and Asia. The US will no longer be a weak link in the fight against financial crimes around the world. Finally, police will have the tools they need to find suspicious transactions, find shell buyers, and break up the financial networks that help dangerous groups around the world. The Art Market Integrity Act fixes one of the biggest problems with the rules that govern money in the United States. It finally makes an industry that has been secretive and weak more open.

Key Points

Finally, Congress is fixing a big gap in financial rules that criminals have been using to take advantage of the art market for years.

Both parties in Congress passed the Art Market Integrity Act, which says that art dealers and auction houses must put in place anti-money laundering measures for the $25 billion industry.

Criminal groups, like cartels, terrorist financiers, and sanctioned Russian oligarchs, use global art markets to launder about $100 billion a year by taking advantage of gaps in the law.

The new rules for compliance only apply to transactions worth more than $10,000. They don't apply to small businesses that make less than $50,000 a year or individual artists who sell their own work.

If you break the rules on purpose, you could get heavy fines of up to $100,000 for each transaction and even five years in prison.

The US follows the same rules as the EU, UK, and Switzerland when it comes to international standards. This keeps the US from becoming a safe place for illegal money-making.

This law makes the art world more like banks and other financial institutions, where people are always watching what happens. This finally gives police the tools they need to take down criminal money networks.

Questions and Answers

Q1. What does the Art Market Integrity Act do? The Art Market Integrity Act is a law that both sides agree on that makes the U.S. art market follow rules against money laundering. It makes art dealers and auction houses put in place rules for high-value art sales to stop money laundering and funding terrorism.

Q2. Why do people want to control the art market? There haven't been many rules in the art market, which has made it easy for criminals to use it to clean up their money. People are very worried about financial security because they think the global art market can wash about $100 billion in illegal money every year.

Q3. Who will the new rules hurt? The new rules will mostly change things for people who work in the art market, such as dealers, galleries, auction houses, museums, and advisors. But these rules don't apply to artists who sell their own work or businesses that sell less than $50,000 worth of art each year and don't do any one sale worth more than $10,000.

Q4. What will happen if you don't follow these new rules? If you break the Art Market Integrity Act, you could face big fines. If someone breaks the law on purpose, they could go to jail for up to five years and pay fines of up to $250,000. People who break the law on purpose could also have to pay civil fines of up to $100,000 for each transaction. If a financial institution breaks the law, they can be fined up to $1 million for each violation.

Q5. How does this law compare to laws in other countries? The Art Market Integrity Act makes American rules the same as those in the UK, EU, Switzerland, and China. This alignment keeps the U.S. from becoming a safe place for illegal activities and makes the fight against money laundering in the art market more global.