Differing Import/Export Values for Antiquities May Indicate Money Laundering Problem, Says Lawyer
There's about a $6.8 billion difference the between the reported export values of art and antiquities coming from the United Kingdom and the import values in the U.S. with the same Harmonized Tariff Schedule (HTS) classification from 2009-2013, according to data compiled by Ricardo St. Hilaire, a lawyer who specializes in cultural heritage issues. The different values "should prompt both American and British customs authorities to investigate the reasons behind the export-import rift," he said in a blog post. The U.K. was the top exporter of archaeological, historical, and ethnological material to the U.S. in 2013
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Using public data from the International Trade Commission and HM Revenue and Customs, St. Hilaire looked at the export and import values during the five-year period from 2009-2013. He found a wide disparity between the claimed export values from the U.K. and import values into the U.S. for goods classified under HTS Chapter 97. Chapter 97 covers works of art, collectors’ pieces and antiques. It also "specifically comprises paintings, drawings, engravings, prints, lithographs, sculptures, statuary, and stamps. It also includes collectors' pieces and collections of zoological, botanical, mineralogical, anatomical, historical, archaeological, and paleontological materials," he said. Numismatics and antiques over 100 years old fall under the definition as well, he said.
For three years within the five-year period -- 2010, 2012 and 2013 -- the U.S. customs value is more than 50 percent less than the reported U.K. value, which were converted to U.S. dollars. "Also noteworthy is the pattern whereby the reported values of U.K. HTS 97 exports are consistently higher than the reported values of U.S. HTS 97 imports," he said. In 2010, the Chapter 97 reported U.S. import value was about $1.2 billion, 50.6 percent less than the $2.4 billion reported as U.K. export value. The 2012 values -- $1.8 billion on import versus $3.8 billion -- showed a 53 percent different and in 2013 the U.S. value was 54 percent less -- $1.7 billion worth imported in the U.S. versus $3.6 billion worth exported from the U.K. -- the largest difference of the years reviewed, he said. There was slight less disparity in the values for 2009 and 2011.
The U.S. has previously voiced concern for the use of global trade for money laundering purposes and law enforcement should review the data, "since customs values for U.S. imports are not determined by government record keepers; they are amounts supplied by importers," he said. "Customs authorities particularly should probe whether there may be evidence of trade based money laundering (TBML)," St. Hilaire said in another blog post (here) "TBML permits criminal networks to earn and transfer money by hiding and remitting profits within the stream of the legal marketplace. One TBML technique is to import goods into the U.S. at an undervalued amount." Commercial lawyers and customs attorneys should also study the value differences and whether they can be justified by changing currency valuations or other relevant factors, he said. CBP didn't comment.