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between the agent and principal) either by confirming with the principal or requesting documentary support thereof from the agent."^[1]

Bonhams Briefing. In a briefing with Subcommittee staff, Bonhams U.S. Counsel, along with outside counsel, explained that prior to the 2018 Bonhams Manual, Bonhams U.S. counsel communicated AML policies to staff during briefings and trainings.^[2] Bonhams U.S. Counsel noted that until 2016, most of the Bonhams U.S. staff was based in San Francisco, which made communication much easier.^[3] She said there was not a need for PowerPoint presentations on AML compliance because "everyone was sitting around the same desk.^[4]"

Bonhams U.S. Counsel told the Subcommittee that, historically, Bonhams U.S. did not check its clients against OFAC's SDN list or any other sanctions lists.^[5] Rather, Bonhams U.S. relied on AML and sanctions checks that its financial institutions perform.^[6] According to Bonhams U.S. Counsel, the company would not knowingly engage in transactions with family members of sanctioned individuals.^[7] Additionally, she represented that Bonhams U.S. would not conduct business with art agents or advisors who were known to represent sanctioned individuals.^[8]

5. Private Art Dealer

The Subcommittee also investigated private art sales, as further explained below. In reviewing those transactions, the Subcommittee interviewed a private art dealer based in New York (the "Private Dealer").^[9] The Private Dealer has thirty years of experience in the art market, having studied at major universities and worked at many art galleries and major art auction houses

The Private Dealer explained that, at the time the transaction described below took place, she had no written AML or sanctions policies.^[10] The Private Dealer explained that she had not received any AML or sanctions-related training at any of the galleries or art auction houses at which she previously worked.^[11] When asked whether she had a legal obligation to question the origin of the funds

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1. Id.
2. Subcommittee Briefing with Bonhams U.S Counsel (Feb. 22, 2019).
3. Id.
4. Id.
5. Id. Bonhams reported that it now routinely screens all clients against the SDN and other sanctions list via a third party screening provider.
6. Id.
7. Id.
8. Id.
9. Subcommittee interview of Private Dealer (Sept. 7, 2018).
10. Id.
11. Id.

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