While the SEC regulates stock trading and all vigilant eyes are on Wall Street to spot potential abuses, Nouriel Roubini spoke at the Economic Forum at Davos about the corruption that surrounds the art market, and advocated for increased regulation, as reported by artnews.com.
Nouriel Roubini who has worked at the World Bank, the Bank of Israel and the IMF, is currently an economist at NYU’s Stern School and an art collector himself, said the problems with the art market are rife and self-regulation is required if the industry wants to avoid external scrutiny and rules.
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“Whether we like it or not, ” Roubini said, “art is used for tax avoidance and evasion. It can be used for money laundering. You can buy something for half a million, not show a passport, ship it. Plenty of people are using it for laundering … While art looks as if it is all about beauty, as a business, it is full of shady stuff. We should correct it or it will be undermined over time.”
Martin Roth of the Victoria and Albert Museum says museums have difficulty keeping up on their acquisitions as prices at auction houses are becoming increasingly inflated. Christie’s reported a 12% increase in average prices from last year, and Southeby’s saw an 18% rise. The largest growth was in purchases of Impressionist and modern art and there was a dramatic increase in buyers from China.
