The debate about anonymity in the art world has intensified over the past year, fed in part by the release of the so-called Panama Papers, which detailed the use of corporate veils to conceal ownership, dodge taxes and enable crime, its authors say. Now various expert groups, like the Basel Institute, are coming forward with ways for dealers and auction houses to curb secrecy and combat money laundering. In a significant change, Christie’s said last week it has strengthened its policy in recent months and now requires agents looking to sell a work through the auction house to tell it the name of the owner they represent.
Borisovich says London’s Russian oligarchs should not be mistaken for conventional, self-made businessmen. “Their riches come from transactions with the Russian government. They either sold something for a fortune to the state of Russia or they bought something for pennies in some sort of privatisation from the state of Russia. Some of them managed to do both, to buy for pennies and sell for fortunes. Some of them never did any of that and they just worked all their life as government officials and somehow in the process became immensely rich,” he says.

When you sell your home the paperwork details the sale, including your name, and the title search lists the names of the people who owned the property before you. But when someone sells an artwork at auction — even something worth $100 million, much more than your house — the identity is typically concealed.  […] In finance, Treasury officials last year began asking banks to identify customers who set up accounts in names of shell companies. In real estate, they introduced a pilot program that requires the full identification of people who buy expensive properties in New York and Miami using cash and shell companies.


Oh fuck yes! Look, I'm not a conspiracy theorist, but the art market is a billion-dollar industry. If it [smuggling] is not tolerated on certain levels, the banks would never reach their peaks. I had people on my payroll at customs... it was barely even necessary to smuggle because you could bring it in almost officially so long as you pay a little bit to the right people.
Morland came out to find most of his profits had been lost. His old friends shunned him and the family firm went bust. So for the next thirty years he became a professional yachtsman-smuggler, plying his trade across the Mediterranean, shifting tons of hash, mixing with everyone from Berber tribesmen to gangland heavies, and alternating between periods of sudden wealth and bleak incarceration. In 1980, 1990 and again in 2000, he was caught and jailed for long terms. Now in his early eighties, he lives in “pretty good poverty” and teaches pottery. This is his amazing story.

Most of the billions vanished into a twilight world of offshore companies. The scheme cleverly mingled fake transactions with real ones. Some of it was spent on luxury items: furs, diamonds, Swiss watches, German industrial equipment, fashionable children’s clothes, plus hotel suites in Alpine ski resorts used by Russian oligarchs. It also went to a pro-Kremlin thinktank in Poland.


Anonymity was certainly a factor in the success of the scam that took down the estimable Knoedler gallery in New York after 165 years in business. Some $80 million was turned over by collectors to purchase unknown, albeit fake, “masterpieces” that were brought to market by a Long Island art dealer and her boyfriend. They said all the work had come from a mystery collector who became known as Mr. X. In fact, they were being created by a forger in his Queens garage.


The Salisbury attack has reopened questions about more than a dozen suspicious deaths of Russians in London in recent years, many of them linked to organised crime. Even before the attack on the Skripals, the relationship between Russian money in London and international crime came under renewed attention with the success of the BBC television series McMafia.
He returned in 1996, trying to build yet another hotel in partnership with a tobacco company. That deal also went nowhere, but Trump was able to successfully apply for Trump Russia trademarks. Ultimately, he never built anything there, but by the early 2000s, his units were suddenly a hit with wealthy Russians. His properties in Florida and NYC are especially popular, with Russian real estate agent Ilya Reznik telling the press that Coastal Miami is often pitched as Little Moscow.
Borisovich says London’s Russian oligarchs should not be mistaken for conventional, self-made businessmen. “Their riches come from transactions with the Russian government. They either sold something for a fortune to the state of Russia or they bought something for pennies in some sort of privatisation from the state of Russia. Some of them managed to do both, to buy for pennies and sell for fortunes. Some of them never did any of that and they just worked all their life as government officials and somehow in the process became immensely rich,” he says.
Having turned the craft of international art smuggling into an art in its own right, Michel Van Rijn was once wanted by authorities all over the world for sneaking valuable pieces of art across sea and land. With millions in the bank, Michel lived the life of a playboy. He owned private planes, enjoyed a harem of beautiful women, and did business with some of the world's most dangerous criminals-many of whom were members of various governments (and probably still are).
“And this doesn’t just apply to the Russians. This is a general cultural thing whereby anyone with money is encouraged to come here. You can effectively buy residency. You’ve got non-dom status, which is very attractive, you’ve got the anonymous companies where beneficial ownership remains hidden, so to this day we have around 100,000 properties in this country whose owners are unknown.”
Well, they are. In 2014, Texas business man Phillip Rivkin was charged with 68 counts of fraud after using millions of dollars worth of photographs to launder money. He had made over $78 million through fraudulent schemes involving his biodiesel production companies—which didn’t actually produce any biodiesel. Rivkin spent roughly $16 million dollars on 2,200 fine art photographs by artists like Edward Steichen, Alfred Stieglitz, and Edward Weston. Works included Edward Weston’s Dunes, Oceano, a gelatin silver print that Rivkin purchased from Sotheby’s for $134,500 and another vintage gelatin silver contact print by Alfred Stieglitz, From the Shelton, West. Rivkin wired Camera Lucida, the seller of the photograph, $150,000 to purchase it.
I'm trying to think of the creative way to do this. I mean, as you may know, you know, most of these transactions are cleared through New York. And the other sort of central place for information is SWIFT in Brussels. But I would go for the clearing banks in New York that cleared the transactions, you know. And there's—again, it's these sort of intermediary entities that have no real interest in protecting the information, and all you have to do is ask for it and they just sort of produced by rote. So we've done a lot of money laundering investigations where we go to the trust companies and the clearing entities. And so, you know, all dollar transactions are generally cleared through New York. So, you know, the main thing you have to do is identify the banks that were used.

To sum up, the Times muddles the very different issues of ensuring the integrity of works of art—the authenticity question—which is real and requires an entity that can work with owners who want to maintain their anonymity for legitimate reasons with the issue of beneficial ownership—which is less pressing with art because it is relatively rare and covered by the parallel system of KYC run by the banks the auction houses rely upon to vouch for their clients’ ability to afford the works they want to buy.
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Trump’s $125 million asking price for the so-called House of Friendship should’ve scared off any potential buyers, never mind get an offer at $95 million for a house in which the owner would never set foot and tear it down while doing absolutely nothing with it for eight years. Would he not get suspicious about the Russian billionaire wildly overspending on real estate?


Morland was heir to a Quaker dynasty that made a fortune turning sheepskins into coats, and lived a gilded youth: his father was a renowned physician and his mother was a key figure in the modern art world, friend of George Orwell and Henry Moore. At 6ft 3in tall, good looking and well connected, Morland skied for England, had a beautiful wife and children, a des-res in south-west London, a farmhouse in Malta and the world at his feet.

Once purchased, the art can disappear from view for years, even decades. A lot of the art bought at auctions goes to freeports – ultra-secure warehouses for the collections of millionaires and billionaires, ranging from Picassos and gold to vintage Ferraris and fine wine. The freeports, which exist in Switzerland, Luxembourg and Singapore, offer a variety of tax advantages because the goods stored in them are technically in transit. The Economist magazine reported that the freeport near the Geneva airport alone is thought to hold $100 billion (U.S.) of art.
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