Saudi Press

Saudi Arabia and the world
Thursday, Oct 02, 2025

UK Art Dealers Are Exploiting a Loophole to Avoid New Money-Laundering Rules

UK Art Dealers Are Exploiting a Loophole to Avoid New Money-Laundering Rules

The UK’s art market has been subject to stringent new regulations since an anti-money laundering directive came into force in January 2020.
While the new requirements to conduct identity checks and other due diligence on art buyers initially came as a shock to an industry that has for centuries operated on handshakes, much of the market is now accustomed to these processes.

But experts say that some art businesses may have misunderstood a key part of the regulations, and could be unwittingly breaking them.

In some transactions, such as an art sale conducted through a chain of different parties, the rules allow for a business to rely on customer due diligence checks carried out by someone else.

Susan J. Mumford and Chris King, who co-founded ArtAML, a tool designed to facilitate customer due diligence checks, have found that some are leaning on this “reliance” option as a way to avoid disclosing the identity of their clients to other businesses they transact with. But they warn that this is actually a dangerous misinterpretation of the rules, and businesses doing this could face fines or even jail time.

“One of the art market’s greatest concerns about the imposition of anti-money laundering regulations is the potential loss of confidentiality surrounding clients,” Mumford says. “The obligation to reveal the identity of the buyer to another dealer as part of compliance in a transaction may risk having your client poached.”

Some dealers may be tempted to see reliance as a solution to this problem. “They tell you, ‘I have checked my client and they’re okay;’ they don’t reveal the collector’s name, and the deal proceeds,” Mumford says. “The problem is: that’s not how reliance works.”

According to both the official legislation and the guidelines published by the British Art Market Federation, if you are relying on the checks carried out by someone else, you still need to know the identity of the ultimate beneficial owner, as well as what level of customer due diligence has been carried out. This is in addition to coming to an agreement with the third party ensuring that they will make copies of this data available on request if needed for compliance purposes.

Plus, the reliance option cannot be used with just anyone. Businesses can only “rely” on other UK entities that are subject to the same money laundering regulations they are. (They can check whether they are listed as an “Art Market Participant” on the government website after the final deadline for registration has passed on June 10.)

If conducting transactions outside the UK, businesses can only use reliance if the other business is subject to the requirements of a previous money laundering directive that’s in force across Europe—meaning UK art businesses can’t use reliance when collaborating with dealers in the US. (Anti-money laundering regulations could soon be coming to the US, however, following the government’s move to create stricter oversight of antiquities dealers earlier this year.)

If a business wants to avoid breaking the rules, it is in their best interest to carry out the checks themselves, or at the very least verify that the checks have been carried out by the other party. “Arguably, it increases your risk,” Mumford says of the reliance option. “Regardless of who carries out the checks, you are ultimately responsible for them and cannot opt out of responsibility.”
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
UK, Canada, and Australia Officially Recognise Palestine in Historic Shift
New Eye Drops Show Promise in Replacing Reading Glasses for Presbyopia
Dubai Property Boom Shows Strain as Flippers Get Buyer’s Remorse
Top AI Researchers Are Heading Back to China as U.S. Struggles to Keep Pace
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
UAE-US Stargate Project Poised to Make Abu Dhabi a Global AI Powerhouse
Trump and Starmer Clash Over UK Recognition of Palestinian State Amid State Visit
Saudi Arabia cracks down on music ‘lounges’ after conservative backlash
Saudi Arabia Signs ‘Strategic Mutual Defence’ Pact with Pakistan, Marking First Arab State to Gain Indirect Access to Nuclear Strike Capabilities in the Region
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Kuwait opens bidding for construction of three cities to ease housing crunch.
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
Could AI Nursing Robots Help Healthcare Staffing Shortages?
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Big Oil Slashes Jobs and Investments Amid Prolonged Low Crude Prices
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Did the Houthis disrupt the internet in the Middle East? Submarine cables cut in the Red Sea
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Tether Expands into Gold Sector with Profit-Driven Diversification
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
Israeli Airstrike in Yemen Kills Houthi Prime Minister
After the Shock of Defeat, Iranians Yearn for Change
YouTube Altered Content by Artificial Intelligence – Without Permission
Iran Faces Escalating Water Crisis as Protests Spread
More Than Half a Million Evacuated as Typhoon Kajiki Heads for Vietnam
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Cristiano Ronaldo Makes Surprise Stop at New Hong Kong Museum
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
×