5 ms·

As Money Launderers Buy Dalís, U.S. Looks at Lifting the Veil on Art Sales

45 points by mariojv 5y ago

snypher 5y ago
How can anyone drop xx million on a painting and not be a money launderer? They're probably a robber baron or tax evader at the very least.
- pushrax 5y ago
  There are art investors/speculators, museums, etc. who obtained money through legit means. Art in the millions is definitely an exclusive market though, and I'm sure draws various unsavory people.
  - snypher 5y ago
    I didn't really consider museums and public institutes. Thanks for the insightful reply.
- tluyben2 5y ago
  Store of value? A 10m$ painting is easier than 10m$ in cash. Also because they tend to appreciate over time.
  - pushrax 5y ago
    Buying a $10M painting is a lot more work than holding $10M in cash, but it does make sense as a store of value given fiat inflation. Buying gold is also easier than buying paintings, and buying gold ETFs is even easier. As is buying stock, bonds, etc. It's easier to hedge societal collapse by buying high value necessities (though who can truly predict how a collapse will unfold). I think there's a certain kind of person who can be a great art investor by having a good idea of what art is going to retain interest (and thus value), but I would not call it easy compared to index funds or most other popular stores of value.
caseysoftware 5y ago
With Hunter Biden taking the art world by storm - https://nypost.com/2021/06/15/hunter-bidens-artwork-is-actually-good-experts-say/ https://nypost.com/2021/06/15/hunter-bidens-artwork-is-actua... - I don't know if this is a good or bad thing. It's good to ensure his art doesn't end up in the hands of criminals but at the same time, does this depress the value of art overall?
- pjc50 5y ago
  Lots of news sources (although seemingly only right wing ones) are flagging the anon buyers as a money laundering risk. https://www.dailymail.co.uk/news/article-9692421/Hunter-Bidens-abstract-paintings-sell-500K-each.html https://www.dailymail.co.uk/news/article-9692421/Hunter-Bide...
  - jl2718 5y ago
    Imagine the possibility that this story is being pushed to build opposition support for stronger financial surveillance laws.
- telesilla 5y ago
  I 100% believed this was a satire post, this is nuts.
  - jl2718 5y ago
    It is. And you’re in it! Has anybody seen the movie: “The Gods Must Be Crazy”?
- redis_mlc 5y ago
  It's worse than it looks. There was no plausible reason for foreign nations to pay him for influence peddling through his father when he flew on Air Force 2 to China and Ukraine when Joe Biden was VP, since Hunter has no discernible skills. By doing watercolors, he can argue that the foreign countries are paying for something tangible rather than influence peddling, which has enough plausible deniability for the MSM media and leftist FBI agents. The icing on the cake is that he's a drug addict, and he paints with a straw.
ackbar03 5y ago
I saw a very interesting take on nfts a while back and why the market will continue to exist and persist. A significant part of the art market is driven by money laundering activities, Nfts have allowed this process to become digitized so that they don't require the physical underlying, which requires storage and handling and shopping costs, anymore
- fshbbdssbbgdd 5y ago
  What’s the advantage of NFTs over other crypto for money laundering?
  - ElViajero 5y ago
    > What’s the advantage of NFTs over other crypto for money laundering? Just a guess, you control the value of the asset. If 1 Bitcoin is $30,000 and I sell it to you for $300,000 that may raise many questions. If you buy the NFT for my art for $30,000 and then it sells in an auction for $300,000 , it is easier to justify that it just has appreciated with time. The world of art is full of this appreciations, many times for money laundering and tax evasion reasons, thou.
CryptoPunk 5y ago
The so-called anti-money laundering push is actually a manifestation of Total Information Awareness, applied to value transfer. It's completely unconstitutional and extremely dangerous. It began in 1989, with leaders of the G7 agreeing at a summit to create the FATF. It has, by at least one account, become one of the least effective policy experiments in history: https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1725366 https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1.... There is a reason that historically, the state needed a warrant, issued by a court, before it could conduct a search. Allowing the state to conduct dragnet surveillance creates the kind of power imbalance that ensures growing income equality and social instability. The need for the state to obtain a warrant before conducting a search was seen as striking the right balance between the need to maintain reasonable checks on the power of the state, and the need to investigate crime. And in one summit, all of that was cast aside. Any actual incident of money laundering involves some underlying crime that generated the illicit revenue. To prove money laundering occurred, you need to prove that the underlying crime occurred. So an AML law is redundant. Any actual money laundering that is proven would land the party involved in prison, for the underlying crime. But the so-called AML laws do not require proving money laundering occurred. It only requires proving that a person did not comply with the AML-related disclosure requirements, i.e. not complying with warrantless mass-surveillance. The crime is privacy.
- deleted 5y ago
  [deleted]
- stavros 5y ago
  I want to dismiss this comment as alarmist nonsense, but I find myself agreeing with every last bit of it.
- nine_k 5y ago
  One can consider AML measures similar to getting your luggage scanned in an airport. Such measures strip everyone of a bit of privacy, but prevent rare nutcases from inflicting large-scale damage. The question is how much benefit an average society member gains for that cost. How many planes were not hijacked because the potential perpetrators knew they won't be able to covertly bring a handgun abroad? How many crimes were not done because the potential perpetrators understood that they won't be able to turn the proceeds into large sums of usable money? It's really hard to measure, and because of that, the extent of such regulations tends to grow, just in case. There's plenty of security theater in airports, along with useful measures. There's plenty of overreach in AML regulations, along with useful measures. Curbing both back to the reasonable levels is a hard task, because it's hard to obtain a strong evidence that a particular level is reasonable at preventing the crime.

45 points by mariojv 5y ago

How can anyone drop xx million on a painting and not be a money launderer? They're probably a robber baron or tax evader at the very least.

pushrax 5y ago
There are art investors/speculators, museums, etc. who obtained money through legit means. Art in the millions is definitely an exclusive market though, and I'm sure draws various unsavory people.
- snypher 5y ago
  I didn't really consider museums and public institutes. Thanks for the insightful reply.
tluyben2 5y ago
Store of value? A 10m$ painting is easier than 10m$ in cash. Also because they tend to appreciate over time.
- pushrax 5y ago
  Buying a $10M painting is a lot more work than holding $10M in cash, but it does make sense as a store of value given fiat inflation. Buying gold is also easier than buying paintings, and buying gold ETFs is even easier. As is buying stock, bonds, etc. It's easier to hedge societal collapse by buying high value necessities (though who can truly predict how a collapse will unfold). I think there's a certain kind of person who can be a great art investor by having a good idea of what art is going to retain interest (and thus value), but I would not call it easy compared to index funds or most other popular stores of value.

caseysoftware 5y ago

With Hunter Biden taking the art world by storm - https://nypost.com/2021/06/15/hunter-bidens-artwork-is-actually-good-experts-say/ https://nypost.com/2021/06/15/hunter-bidens-artwork-is-actua... - I don't know if this is a good or bad thing. It's good to ensure his art doesn't end up in the hands of criminals but at the same time, does this depress the value of art overall?

pjc50 5y ago
Lots of news sources (although seemingly only right wing ones) are flagging the anon buyers as a money laundering risk. https://www.dailymail.co.uk/news/article-9692421/Hunter-Bidens-abstract-paintings-sell-500K-each.html https://www.dailymail.co.uk/news/article-9692421/Hunter-Bide...
- jl2718 5y ago
  Imagine the possibility that this story is being pushed to build opposition support for stronger financial surveillance laws.
telesilla 5y ago
I 100% believed this was a satire post, this is nuts.
- jl2718 5y ago
  It is. And you’re in it! Has anybody seen the movie: “The Gods Must Be Crazy”?
redis_mlc 5y ago
It's worse than it looks. There was no plausible reason for foreign nations to pay him for influence peddling through his father when he flew on Air Force 2 to China and Ukraine when Joe Biden was VP, since Hunter has no discernible skills. By doing watercolors, he can argue that the foreign countries are paying for something tangible rather than influence peddling, which has enough plausible deniability for the MSM media and leftist FBI agents. The icing on the cake is that he's a drug addict, and he paints with a straw.

ackbar03 5y ago

I saw a very interesting take on nfts a while back and why the market will continue to exist and persist. A significant part of the art market is driven by money laundering activities, Nfts have allowed this process to become digitized so that they don't require the physical underlying, which requires storage and handling and shopping costs, anymore

fshbbdssbbgdd 5y ago
What’s the advantage of NFTs over other crypto for money laundering?
- ElViajero 5y ago
  > What’s the advantage of NFTs over other crypto for money laundering? Just a guess, you control the value of the asset. If 1 Bitcoin is $30,000 and I sell it to you for $300,000 that may raise many questions. If you buy the NFT for my art for $30,000 and then it sells in an auction for $300,000 , it is easier to justify that it just has appreciated with time. The world of art is full of this appreciations, many times for money laundering and tax evasion reasons, thou.

CryptoPunk 5y ago

The so-called anti-money laundering push is actually a manifestation of Total Information Awareness, applied to value transfer. It's completely unconstitutional and extremely dangerous. It began in 1989, with leaders of the G7 agreeing at a summit to create the FATF. It has, by at least one account, become one of the least effective policy experiments in history: https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1725366 https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1.... There is a reason that historically, the state needed a warrant, issued by a court, before it could conduct a search. Allowing the state to conduct dragnet surveillance creates the kind of power imbalance that ensures growing income equality and social instability. The need for the state to obtain a warrant before conducting a search was seen as striking the right balance between the need to maintain reasonable checks on the power of the state, and the need to investigate crime. And in one summit, all of that was cast aside. Any actual incident of money laundering involves some underlying crime that generated the illicit revenue. To prove money laundering occurred, you need to prove that the underlying crime occurred. So an AML law is redundant. Any actual money laundering that is proven would land the party involved in prison, for the underlying crime. But the so-called AML laws do not require proving money laundering occurred. It only requires proving that a person did not comply with the AML-related disclosure requirements, i.e. not complying with warrantless mass-surveillance. The crime is privacy.

deleted 5y ago
[deleted]
stavros 5y ago
I want to dismiss this comment as alarmist nonsense, but I find myself agreeing with every last bit of it.
nine_k 5y ago
One can consider AML measures similar to getting your luggage scanned in an airport. Such measures strip everyone of a bit of privacy, but prevent rare nutcases from inflicting large-scale damage. The question is how much benefit an average society member gains for that cost. How many planes were not hijacked because the potential perpetrators knew they won't be able to covertly bring a handgun abroad? How many crimes were not done because the potential perpetrators understood that they won't be able to turn the proceeds into large sums of usable money? It's really hard to measure, and because of that, the extent of such regulations tends to grow, just in case. There's plenty of security theater in airports, along with useful measures. There's plenty of overreach in AML regulations, along with useful measures. Curbing both back to the reasonable levels is a hard task, because it's hard to obtain a strong evidence that a particular level is reasonable at preventing the crime.