Angelika Hellweger of Rahman Ravelli examines the Office of Financial Sanctions Implementation’s Art Market Participants and High Value Dealers Threat Assessment report
The Office of Financial Sanctions Implementation (OFSI) has published its Art Market Participants and High Value Dealers Threat Assessment.
As of May 2025, the art market and high value dealers became subject to mandatory sanctions reporting obligations. The OFSI report identifies key sanctions evasion threats, details red flags that businesses should be aware of, and offers guidance on areas where compliance could be strengthened.
According to the report, it is likely that Russian designated persons and their enablers have dealt with high-value goods in the UK in breach of asset freeze prohibitions and have not reported this to OFSI.
Red Flags
The one theme that runs through the report is the need for enhanced due diligence when dealing with high-value goods potentially linked to sanctioned individuals.
With this in mind, the report highlights the red flags that should trigger enhanced due diligence and, if and when necessary, reporting to OFSI.
These are:
- Counterparties, including buyers and sellers, who have discernible links to sanctioned jurisdictions.
- Counterparties attempting to conceal links to a sanctioned jurisdiction. For example, through the possession and use of a ‘golden passport’, where citizenship is granted to an individual who makes a financial contribution to the state granting the citizenship.
- Counterparties whose personal details - including name, address and/or date of birth - match the OFSI Consolidated List of Financial Sanctions targets in the UK. When assessing a potential name match, art market participants and high value dealers need to be aware of the possible effect of different spellings and transliterations.
- A counterparty refusing to provide information, particularly in relation to know-your-customer (KYC) checks, without reasonable justification.
- Counterparties, particularly sellers, attempting to rush or delay a transaction while failing to engage with KYC checks.
- Buying or selling high-value goods at a price substantially higher or lower than the market value, or where the seller (or a third party acting on their behalf) is uninterested in recouping their initial investment.
- The ownership history of a high-value item being unclear or not explained by a counterparty.
- Buyers or sellers attempting to split the overall cost of a high-value item into smaller payments, particularly if they negotiate the price below EUR 10,000.
- A non-designated individual (including relatives and business associates of a designated person) claiming to be the original owner of a high-value item, despite indications that the asset was acquired using the designated person’s funds prior to their designation.
- Arrangements to physically transfer high-value goods owned, held or controlled by a designated person following their designation. This could include shipping them outside of the UK through various means.
- Enablers, such as family members or associates, dealing with high-value goods owned, held or controlled by a designated person in any capacity without a logical reason.
- Requests for unusual or complex high-value goods delivery arrangements, including those involving intermediary jurisdictions, without a clear reason for doing so.
Conclusion
The UK’s sanctions landscape has changed significantly since Russia’s 2022 invasion of Ukraine. Sanctions are evolving and OFSI hopes that this threat assessment will assist with compliance.
Its contents highlight the challenges that those dealing in art, antiquities and other high-value goods face when it comes to ensuring they are not facilitating sanctions evasion.
