Transnational Crime and the Developing World

Recommendations

Info

Table M. Notable Art Heists Year Artwork Stolen Location Estimated Value The Louvre 1911 Mona Lisa by da Vinci $794 million Paris, France 13 pieces including Storm on the Sea of Isabella Stewart Gardner Museum 1990 Galilee by Rembrandt and The Concert $500 million Boston, Massachusetts, United States by Vermeer 1991 20 paintings including Sunflower and The Potato Eaters by van Gogh The Van Gogh Museum Amsterdam, Netherlands $500 million 2008 2010 2004 4 paintings including Poppies near Vetheuil by Monet and Boy in a Red Waistcoat by Cézanne 5 pieces including Le Pigeon aux petispois by Picasso and La Pastorale by Matisse The Scream (1910) and Madonna by Munch 1994 The Scream (1893) by Munch 2002 2007 Two pieces by van Gogh including View of the Sea at Scheveningen Three pieces including Maya and Her Doll and Portrait of Jacqueline by Picasso 2010 Poppy Flowers by van Gogh 2007 Portrait of Suzanne Bloch by Picasso and O Lavrador de Café by Portinari 2003 Madonna of the Yarnwinder by da Vinci 1985 2012 2005 140 Maya, Aztec, Zapotec, and Miztec artifacts, including jade and gold pieces 7 pieces including Tête d'Arlequin by Picasso and Femme devant une fenêtre ouverte by Gauguin Reclining Figure, a 2-ton bronze sculpture by Moore Sources: See Appendix, seciton D for a list of sources. Foundation E.G. Bührle Zurich, Switzerland Musée d'Art Moderne de la Ville de Paris Paris, France The Munch Museum Oslo, Norway National Gallery Oslo, Norway The Van Gogh Museum Amsterdam, Netherlands Private residence Paris, France Mohamed Mahmoud Khalil Museum Cairo, Egypt São Paulo Museum of Art São Paulo, Brazil Drumlanrig Castle Dumfriesshire, Scotland National Museum of Anthropology Mexico City, Mexico Kunsthal Museum Rotterdam, Netherlands Henry Moore Foundation Much Hadham, England $163 million $123 million $121 million $100 million $100 million $68 million $55 million $55 million $47 to $79 million >$27 million $24 million $5.3 million There are several aspects of the licit fine art and antiquities market, particularly value and pricing, that make it favorable for money laundering. Economist Nouriel Roubini aptly stated: “While art looks as if it is all about beauty, as a business it is full of shady stuff.” 158 First, the legal art market generates billions of dollars in sales every year—US$63.8 billion in 2015. 159 The high value means that spurious 158 Henry Lydiate, “Regulating the Art Industry,” Artquest, 2015 159 The European Fine Art Foundation, “U.S. Art Market Reports Highest Ever Level of Sales While Overall Global Market Values Fall” (Press Release, Helvoirt, Netherlands, March 2, 2016), https://www.tefaf.com/getattachment/Press/Press-releases/US-Art-market-reports-highest-ever-level-of-saleswhile-overall-global-market-values-fall.pdf?lang=en-US. Global Financial Integrity 36
or illicit transactions can get buried in the large volume of legal transactions. This is compounded by the fact that more than half of transactions are conducted as private sales, which make them relatively untraceable. Second, unlike other high-value goods such as gold, there are no established world market prices for most cultural property. In addition, prices are subjective; some pieces may have intrinsic value to certain buyers, making them willing to pay more. The Financial Action Task Force (FATF) notes that customs agencies have greater difficulty in recognizing over- and under-invoicing when it involves complex goods with “highly ‘speculative’ values.” 160 Third, there is an overall absence of transparency or regulation of the art market. The market operates without the safeguards required of other high-value, high-risk markets and industries, such as real estate, insurance, casinos, and dealers of precious stones and metals. Of 212 surveyed countries and jurisdictions, only 35 had anti-money laundering and combatting the financing of terrorism rules (AML/ CFT) on customer due diligence that specifically included dealers in art and/or antiquities. 161 The vast majority of countries also do not regulate the sale of art, unlike the sale of other high-value items such as real estate and automobiles. There is no transaction record, no reporting to authorities, and no recorded transfer of title. Kris Hollington makes a strong argument against the practice: “We wouldn’t buy a house without a deed, yet people do this with art worth millions of dollars all the time.” 162 Finally, the art market is global, and the majority of pieces are easily portable. Similar to diamonds or gold, it can be much easier to transport and transfer artwork than the equivalent value in hard currency. Art and antiquities also can serve as an alternative currency and be exchanged for other illicit goods such as arms or drugs. This is not to say that the majority of the global art market, or even a robust minority, operates illicitly; nonetheless, opacity provides an environment for crime to flourish. C. Dynamics With movies such as Ocean’s Twelve, Entrapment, and The Thomas Crowne Affair, Hollywood and popular culture have promoted the idea that art theft is a glamorous, highly organized act perpetrated by sophisticated career criminals. This fanciful narrative represents only a sliver of actual thefts; the truth is that art theft is quite mundane. The idea of a professional art thief is a fallacy according to Anthony Amore, director of security at the Isabella Stewart Gardner Museum in Boston. 163 While some criminals may collaborate and demonstrate some level of organization in planning and commission, it is likely that extremely few “art theft” groups could be classified as transnational organized crime groups. For thieves, therefore, the actual “art” of art theft is the ability to profit from the crime. 164 Opportunistic actors, often common criminals and petty thieves, see the theft of cultural property as an easy score—a low risk, high reward situation. “What [thieves] don’t understand,” says Wittman, “is that the value of art is dependent on three things: authenticity, provenance—the history of the art—and legal title.” 165 Thieves focus on the authenticity of a piece and the notoriety of its artist, envisioning a huge payday; they fail to realize that once stolen, and thus with no legal title, the piece has largely become worthless. Despite very bad odds, if a thief is successful in stealing a well-known piece, there are three primary ways to profit from the theft. First, thieves can attempt to sell the painting, but even if they are successful they are likely to receive only 5 to 10 percent of the painting’s legitimate value. 166 Second, thieves may 160 Financial Action Task Force, Trade Based Money Laundering (Paris, France: Financial Action Task Force, June 23, 2006), 5, http://www.fatf-gafi. org/media/fatf/documents/reports/Trade%20Based%20Money%20Laundering.pdf. 161 U.S. Department of State, Money Laundering and Financial Crimes Country Database: June 2015 (Washington, DC: Bureau for International Narcotics and Law Enforcement Affairs, U.S. Department of State, 2015), http://www.state.gov/documents/organization/239329.pdf. 162 Hollington, “After Drugs and Guns, Art Theft Is the Biggest Criminal Enterprise in the World.” 163 Amore, Interview by the author. 164 Ozernoy, “The Art of the Heist.” 165 Jordan Weissmann, “Have You Ever Tried to Sell a Stolen Painting?,” The Atlantic, October 16, 2012, http://www.theatlantic.com/business/archive/2012/10/have-you-ever-tried-to-sell-a-stolen-painting/263682/. 166 Tarmy, “What Happens to Stolen Art After a Heist?”; Tim Murphy, “The Biggest Unsolved Art Heist—and the Detective Who Came Close to Cracking It,” Mental Floss, March 17, 2015, http://mentalfloss.com/us/go/53527; Colleen Curry, “The Most Valuable Works of Stolen Art No One Can Find,” ABC News, April 14, 2012, http://abcnews.go.com/US/worlds-valuable-missing-works-art/story?id=16131807; Ed Caesar, “What Is the Value of Stolen Art?,” The New York Times, November 13, 2013, http://www.nytimes.com/2013/11/17/magazine/what-is-the-value-of-stolen-art.html. Transnational Crime and the Developing World 37
Page 1 and 2: Transnational Crime and the Develop
Page 3 and 4: Transnational Crime and the Develop
Page 5 and 6: Global Financial Integrity is pleas
Page 7 and 8: Contents Glossary..................
Page 9 and 10: Appendix Table E. Estimated Value o
Page 11 and 12: Glossary ACT AML ATS Avg. BACRIM BP
Page 13 and 14: Executive Summary Overview Transnat
Page 15 and 16: Illegal, Unreported, and Unregulate
Page 17 and 18: I. Introduction The aim of this rep
Page 19 and 20: II. Drug Trafficking A. Overview Th
Page 21 and 22: done throughout the year, increasin
Page 23 and 24: market is primarily supplied domest
Page 25 and 26: legitimate work. Money laundering i
Page 27 and 28: easily accessible, with some being
Page 29 and 30: III. Trafficking of Small Arms and
Page 31 and 32: Table E. Price vs. Distance: The We
Page 33 and 34: on Drugs and Crime (UNODC) show tha
Page 35 and 36: eactivated handgun that had been so
Page 37 and 38: IV. Human Trafficking A. Overview H
Page 39 and 40: Human trafficking and human smuggli
Page 41 and 42: up deposits) to avoid currency repo
Page 43 and 44: and it has used some others as suic
Page 45 and 46: V. Illegal Organ Trade A. Overview
Page 47 and 48: developed countries is US$20,000, w
Page 49 and 50: E. Recent Developments The consider
Page 51: VI. The Illicit Trade in Cultural P
Page 55 and 56: trafficking transactions, providing
Page 57 and 58: Paying ransom demands, as well as t
Page 59 and 60: VII. Counterfeit and Pirated Goods
Page 61 and 62: and pirated goods come from China.
Page 63 and 64: Box 2. Pharmaceutical Crime Counter
Page 65 and 66: Figure IV. Terrorist Financing and
Page 67 and 68: F. Summary With an estimated US$923
Page 69 and 70: VIII. Illegal Wildlife Trade A. Ove
Page 71 and 72: Table R. Poacher vs. Consumer Price
Page 73 and 74: Community-based ecotourism is a pow
Page 75 and 76: was traditionally seen as a conserv
Page 77 and 78: IX. Illegal, Unreported, and Unregu
Page 79 and 80: IUU fishing particularly flourishes
Page 81 and 82: Figure V. Trade Misinvoicing to Lau
Page 83 and 84: E. Recent Developments The fishing
Page 85 and 86: X. Illegal Logging A. Overview Ille
Page 87 and 88: C. Dynamics Illegal logging, like o
Page 89 and 90: illion in revenues and taxes annual
Page 91 and 92: XI. Illegal Mining A. Overview Mine
Page 93 and 94: C. Dynamics The discussion of confl
Page 95 and 96: damages that can affect generations
Page 97 and 98: Figure VIII. Illegal Mining, Trade
Page 99 and 100: XII. Crude Oil Theft A. Overview Cr
Page 101 and 102: estimate places the daily loss of c
Page 103 and 104:
Figure IX. Pipelines and Drug Traff
Page 105 and 106:
Small-scale oil theft and refining
Page 107 and 108:
F. Summary The theft of crude oil r
Page 109 and 110:
XIII. Policy Recommendations Overvi
Page 111 and 112:
on the lack of oversight secrecy ju
Page 113 and 114:
at the top levels, and authorized c
Page 115 and 116:
XIV. Conclusion Transnational crime
Page 117 and 118:
Appendix: Methodology This appendix
Page 119 and 120:
2. The Average Cost of an AK-47 The
Page 121 and 122:
Japan 502 $80,000 Low $14,000 High
Page 123 and 124:
519 Appendix Table I. Price Range o
Page 125 and 126:
D. Trafficking in Cultural Property
Page 127 and 128:
E. The Illegal Wildlife Trade This
Page 129 and 130:
Appendix Table P. Source vs. Market
Page 131 and 132:
Appendix Table R. Estimated Illegal
Page 133 and 134:
Bibliography “7 Nabbed for Intern
Page 135 and 136:
Cat Skin Trade. London: Environment
Page 137 and 138:
Chugh, Nishtha. “Need a Kidney? I
Page 139 and 140:
Dunlevy, Sue. “Australians Turn t
Page 141 and 142:
Federation. Accessed September 12,
Page 143 and 144:
Gupta, Sanjay. “Unintended Conseq
Page 145 and 146:
“International Plan of Action to
Page 147 and 148:
Lerner, Maura. “U.S. Man Defies D
Page 149 and 150:
the Wildlife TRAPS Project. Cambrid
Page 151 and 152:
ence 13, no. 3 (September 2014): 31
Page 153 and 154:
Schmidle, Nicholas. “Disarming Vi
Page 155 and 156:
Strobel, Warren, Jonathan Landay, a
Page 157 and 158:
Quartz, August 12, 2016. http://qz.
Page 159 and 160:
“Update on Rhino Poaching Statist
Page 161 and 162:
Intelligence, September 6, 2013. ht
Page 163 and 164:
About Global Financial Integrity Fo
Page 166:
1100 17th St, NW, Suite 505 | Washi
show all

Transnational Crime and the Developing World

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?