https://www.artnews.com/art-news/news/uk-art-dealers-fined-money-laundering-1234753469/

The UK’s art market is facing intense scrutiny from HM Revenue & Customs (HMRC), which is ramping up its enforcement of anti-money laundering (AML) regulations.

This is evident in the latest round of fines, published by HMRC on July 10. Issued to Art Market Participants (defined as “a company or sole practitioner who trades in or acts as an intermediary in the buying or selling of works of art where the transaction value, or a series of linked transactions, is €10,000 or more”), the fines are increasingly being issued for operational compliance violations, as opposed to simple registration failures.

One of the most glaring fines on the recent list was handed to London-based DYS44 Art Gallery Limited, which was ordered to pay £158,679 ($213,000) for a plethora of procedural failures, including “[not] carrying out risk assessments, having the correct policies, controls and procedures, appropriate staff training, conducting due diligence, timing verification, and record keeping.”

Old Masters dealer Cesare Lampronti is DYS44’s director. He told the Art Newspaper: “I have taken significant steps to correct this concerning and unusual situation to be sure the gallery is fully compliant with HMRC regulatory developments.”

DYS44 was fined by HMRC for formal procedures as opposed to engaging in illicit activity, such as money laundering. “Although no excuse, my more than than 60 years of experience and personal level of confidence in the integrity of the collectors and art market participants with whom I work, contributed to my assessment that the gallery was operating a low-risk business,” Lampronti said.

The latest HMRC penalties cover the period from October 1, 2024, to March 31, 2025. Rena Neville, director of AML consultancy Corinth Consulting, noted a sharp uptick in enforcement. “Over 80 penalties were issued in this six-month window, compared to 61 over the previous 20 months,” she said.

While many fines still relate to delayed registrations, a rising number now reflect more complex breaches. Atlas Gallery, for example, was fined £28,500 for not reporting material changes in its business to HMRC. The gallery declined to comment to the Art Newspaper on the matter.

“Compliance goes beyond registration,” an HMRC spokesperson said. “Businesses must maintain robust systems and controls to prevent criminal abuse.” HMRC has also committed to working closely with industry stakeholders to ensure awareness and understanding of regulatory obligations.

The scale of penalties is also rising. In early 2024, registration-related fines averaged over £3,000 ($4,00), but the latest figures show an average of £6,900 ($9,200), with some exceeding £23,000 ($31,000). The highest fine surpassed £150,000 ($200,000), and even minor non-registration penalties now typically exceed £1,200 ($1,600).

Tom Noon, CEO of due diligence platform Arcarta, stressed the need for ongoing monitoring. “Participants must recheck customer information regularly,” he said. “A three-month refresh cycle is a sensible minimum, particularly for high-risk clients.”

Paul Hewitt, director general of the Society of London Art Dealers, raised concerns over penalties for technical breaches, suggesting that some of the enforcement appears more bureaucratic than meaningful. Still, with fines rising, it’s clear HMRC is now actively testing whether AMPs are managing AML risks in line with expectations.