Anti-Money Laundering (AML)

 

  • £5,000 penalty for each 3 months of trading in €10,000+ art works whilst unregistered

  • Significant penalty reductions for voluntary disclosure of unregistered trading 

 

As previously explained, from 10 January 2020 onwards any member handling works of art priced above €10,000 was not only required to carry out due diligence ID checks on customers purchasing such works, but also to prepare a written money laundering risk assessment for their business and to document in writing their anti-money laundering policies, controls and procedures.  Those already selling works of art priced at this level were also required to register with HMRC as an Art Market Participant (AMP) no later than 10 June 2021.

 

HMRC recently issued the following statement:

AMPs were required to register with HMRC by 10 June 2021. HMRC are still seeing new applications from AMPs each month. Trading before applying to register makes you liable to a financial penalty imposed by HMRC. If you have been trading but did not register before 10 June, you will get a reduced penalty if you come forward to HMRC, and if you pay the penalty promptly.

The penalty is currently set at £5,000 for each 3 months you trade while unregistered, plus a £350 penalty administration charge. You can get a 50% reduction if you tell HMRC about your unregistered activity. You will get a 25% reduction to the amount payable if you pay it within 30 day. If you need to register with us go to https://www.gov.uk/guidance/register-or-renew-your-money-laundering-supervision-with-hmrc  and also email us at [email protected] and tell us about your unregistered activity.

 

When dealers apply to be registered they will be asked whether they have made sales of works of art above the €10,000 threshold prior to the date on which they are applying for registration.  If they have made such sales then they will be liable to the penalties.  My interpretation of the two HMRC paragraphs above is that in order to benefit from the reduced penalties, a dealer who had been trading whilst unregistered would be advised to "come forward" by sending an email to the email address given, before then registering as an AMP.  The email could state that they are about to register as an AMP and acknowledge that they have been trading in art works above the €10,000 threshold whilst unregistered.

 

For more information see these previously-issued BADA articles about AML registration:

Anti-money laundering registration

10 June deadline for Anti-Money Laundering registration fast approaches

 

Mark Dodgson, 4 April 2022