Art Market Participants fined by HMRC for AML fails

According to a disclosure by HM Revenue & Customs (HMRC) last week, nearly 50 UK art businesses have been included in a newly published list of Art Market Participants (AMPs) that failed to comply with money laundering regulations.

Galleries include:-

• Opera
• Carl Kostyál
• White Cube.

The penalties, issued between January 1 and September 30, 2024, average over £3,000 and peak at £13,000. All stemmed from failure to register by the June 2021 deadline.

The Art Newspaper first reported the fines.

• https://www.theartnewspaper.com/2025/03/21/latest-round-of-money-laundering-penalties-hit-uk-trade

According to the Art Newspaper, some businesses voluntarily disclosed their late registration, only to find that they still faced substantial fines.

Speaking anonymously to the Art Newspaper, one gallerist said their £10,000 penalty had “scared so many dealers we know” and left them feeling like they’d been penalised “for being honest.”

Moreover, several anonymous sources told the Art Newspaper that they had opted not to appeal their fines, citing difficulties in identifying the right contact at HMRC and wishing to “move on and forget the experience.”

However, a handful of experts were brave enough to challenge the HMRC’s methods in print. An art compliance consultant, Rakhi Talwar, told the Art Newspaper that while “late registration fines are based on a set formula,” the penalty calculations are flawed. “It’s not proportionate to include profits from transactions that fall below the €10,000 threshold or services unrelated to art dealing.”

Susan Mumford, founder of compliance platform ArtAML, agreed, particularly regarding small galleries. “For micro-businesses rarely transacting above the threshold, we always recommend working with HMRC to arrange manageable payments. The aim isn’t to force [art market participants] out of business.”

She noted that voluntary registration could halve fines, while payments made within 30 days can reduce them by 25 per cent.

An HMRC spokesperson defended the agency’s approach, saying that its purpose is to “support businesses in protecting themselves from criminals who would exploit their services,” which includes taking action against those businesses who fail to meet their legal obligations.

The UK’s anti-money laundering regulations have a broad reach. Both art advisers and interior design firms made it onto the HMRC’s list.

This has led to criticism that the agency, which was focused on raising awareness among galleries and art dealers, didn’t comprehensively handle its due diligence regarding intermediaries like designers and advisers. Meanwhile, trade associations call for reform, including a more realistic threshold and a “reassessment of the art market’s high-risk classification.”

Source

• https://www.theartnewspaper.com/2025/03/21/latest-round-of-money-laundering-penalties-hit-uk-trade
• https://www.artnews.com/art-news/news/uk-art-businesses-fined-money-laundering-compliance-aml-1234736548/