This Week in AML

Where Do Artifacts in Museums Belong?

The International Consortium of Investigative Journalists (ICIJ) has published a story about artifacts in the Metropolitan Museum of Art catalog linked to possible looting and trafficking. John and Elliot discuss the global problem of antiquities trafficking and its impact on the countries from which items come.



Where Do Artifacts in Museums Belong? - TRANSCRIPT

Elliot Berman: I'm good. And yourself, John?

John Byrne: Good. I know you have some exciting stuff going on this weekend. Why don't you tell us a little bit about that? Yes.

Elliot Berman: Our son and his fiance are getting married on Saturdays. Out of town company is starting to flow in starting this evening and then obviously into the weekend.

And we're looking to forward to a wonderful. Celebration and it's always good to have something to celebrate. Life's got plenty of bumps in it, so when something really great comes along, you want to just embrace it and enjoy it, and that's the plan.

John Byrne: Not on the same level at all, but because we did mention it l last week's conversation, our Marquette Golden Eagles did win the first game in their NCAA to but lost on Sunday. My wife and I and my daughter were there for the loss of Michigan State.

The good news is all the players are coming back. Sad. We thought they'd go a little further, but great season was. Glad to be able to see a couple of games, but there's no question that once you get success, you want more.

But have to say, Marquette made us pretty happy this year in terms of in terms of the team and the season and all the success they had.

Elliot Berman: Agreed. There's no question that if you're a Gold Eagles fan this is the season we've been waiting for a number of years. And it was fun while it lasted, and fun just to look back on it even without going further in the tournament.

John Byrne: That's right. So this week, ICIJ who we've referenced many times before, the great investigative journalist group published a story earlier this week looking at the antiquities market, an area that we know well through our connection with folks from the Antiquities Coalition and the Financial Crime Task Force.

But the article talks about a thousand artifacts that were discovered in the Metropolitan Museum of Art New York, in their catalog that were linked to alleged looting and trafficking figures. You took a look at that story. What was your big takeaway from that?

Elliot Berman: My big takeaway is, that the Met in an effort to become a museum of global standing went through an aggressive period of acquisitions in the antiquity space and seemed to be willing to ignore the kind of due diligence that ideally museums and any purchaser would go through to understand the sourcing and the providence of antiquities or art.

And that's disappointing. I think it's also worth stating that the Met is by no means the only museum that has challenges in this space. There have been many repatriations over the last number of years from museums around the world to get artifacts back to their original source locations.

John Byrne: Yeah, so you should read the whole article, obviously, and they do have some of the statistics that we've referenced besides the a thousand plus pieces that were previously owned by people who've been indicted or convicted of antiquities crime. They said more than 150 additional items in the Met's antiquities collection passed through ownership of nearly a dozen more people or galleries from whom prosecutors seized, stolen ancient works.

Again, this is all about what is your process. You're right, obviously they became much more aggressive in terms of purchasing and collecting. And as Tess Davis, our colleague who's the Executive Director of Antiquities Coalition, is quoted in the story as saying "the Met sets the tone for museums around the world."

She said, the Mets letting all of these things fall through the cracks. What hope do we have for the rest of the art market? So clearly, Tess and the organizations looking at this are very concerned because again, you have these high level museums. If it's happening there, why would it not stand reasonably happening in all sorts of museums around the world that don't have.

The resources or the policies, I guess to some degree that the Met has?

Elliot Berman: Yes. Another thing that I took away from this article, is that a number of the US federal law enforcement agencies have active sections that work on art and antiquities theft and trafficking. HSI has such a unit and there is also an art theft team at the FBI. And they view this broadly. So both of those law enforcement organizations are very active in this space and have been involved identifying stolen items and then with State Department support working on repatriation to their places of origin.

John Byrne: You mentioned Homeland Security. What's interesting to me on this story is there's an antiquities trafficking unit in the in Manhattan, the Assistant District Attorney's Office in Manhattan, and it's led by the lawyer by the name of Matthew Bogdanos, who I actually went to high school with.

Matthew's unit has worked with Homeland Security , and he's been a leader in this space for many years. He's quoted in the story that said the office is not investigating the Met specifically, but that prominent pieces in the collections that have been swept up in investigations that focus on individual traffickers have showed the source being the Met.

So as you say, the Met's not alone in their struggles, but it's both interesting that there are these other law enforcement entities both in state and federal level that work in this space, but also that obviously the Met is just one primary but pretty high level example here. Someone else says something that I wanna reference quickly.

Somebody who's an expert on Asian art and antiquities that's quoted in the story says the following, that the antiquities market has been called the largest unregulated market in the world. And then she goes on to say, it's self-regulating, and you don't know what goes on behind closed doors. That's why Congress in the AMLA Law has required FinCEN to put a regulation out, a notice of proposed rule making on including antiquities dealers, sellers, purchasers, and advisors under the Bank Secrecy Act.

We're still awaiting that proposal. It has not happened yet, but because of all these issues that are amplified in this, That's why Congress agreed in a bipartisan manner to include antiquities under the Bank Secrecy Act. Obviously we are still waiting those regulations.

Elliot Berman: Yes, it's clearly a serious problem.

And it's interesting, many of the pieces come either through disreputable dealers or, they come from donations by private collectors who may or may not have done any due diligence in their acquisition. It calls into question, what are museums to do in the future? With all of the capabilities we have today of reproduction and video technologies and things like that, do museums take on a different form at some point in the future where their collections don't have to have originals to be valued as repositories and transmitters of global culture.

Can you and I go to the museum of our choice in the not too distant future and see things that we would've seen the originals in the current

environment, but rather than have to acquire those in inappropriate ways, will there be a way to exchange or share images that also help me understand things about places in the world that I've never been in, will never travel to without having to traffic the material.

John Byrne: And, my takeaway is this having been in the financial space financial institution space for decades, the early parts of additions of requirements to anti-money learning to our industry, there was a lot of push. From financial institutions saying, we're not law enforcement.

We don't have, this is not why we exist. We shouldn't have these obligations. That ship has sailed a long time ago, and it's been expanded to obviously precious metal dealers been expanded to eventually all aspects of real estate, securities, so the notion that antiquities or art shouldn't have any obligation to understand the sources of how they're benefiting is a losing argument.

So I am not sympathetic. Nothing is gonna solve the problem completely. So let's get that out there. I think it's clear. It will place some hurdles for criminals and those that are benefiting from the movement of either, either either pieces that are illicit or come from illicit acts, what have you.

But it will make it more difficult and I think we all should understand there should be an obligation from all of us to do some due diligence. And I don't buy the notion, that the museum does all of its due diligence or that there shouldn't be some obligations. I think there should be careful, it should be smart regulation, but there should be regulation and we will eventually see that in the US and I think it'll put a dent in this obvious major problem.

Elliot Berman: Agreed. We have a webinar scheduled the 20th of April, and we're going to talk about tech enabled managed services. For those of you who are in the operational side of your compliance programs there are times when you consider using a trusted partner for outsourcing to assist with your review of various alerts or other projects, and you do that through managed services.

Now with the ongoing advancements in technology, coupling that with newer technology is an opportunity for even more assistance. And we're gonna talk about that with some of our in-house experts. And again, that's April 20th. And you'll be able to when you hear this recording, you'll be able to go to our website and to register.

And John why don't you do our shameless plug for the Partnership Forum.

John Byrne: So the AML Partnership Forum is going to be held in Washington DC April 26th to the 28th. We just confirmed Katherine Chen, the CEO of Polaris who will be kicking off the first day. And obviously Polaris is a great organization that deals with assisting trafficking victims and anti-human trafficking policies and procedures, but also they work very closely and partner.

Both the public and the private sector. So it's a really a relevant way to start that program. So go to am p.com for more information. We're limiting attendees, so you need to step up and do that. The other thing I'll mention quickly is related to what we just talked about. I interviewed Liz Vaccaro from the Antiquities Coalition a couple weeks ago, that's a interview on AML Conversations that you can listen to where she discusses the recent report from FATF regarding an the antiquities and art markets. So it's consistent with what we've just discussed today.

Thanks Elliot, we will talk next time. And this is John Byrne. We'll see you next week.