Hauser & Wirth sanctions prosecution: New enforcement focus on arts and luxury goods market
The UK art market has been drawn into the centre of UK sanctions enforcement, with the UK-registered entity of global gallery Hauser & Wirth appearing before Westminster Magistrates' Court on 12 November, charged under UK Russia sanctions regulations. The gallery is alleged to have made a high-value artwork available to Alexander Popov, a collector who runs a prominent art foundation with his wife and is not himself a designated person under the UK sanctions regime.
No pleas were entered at the first appearance on 12 November, and the case has been sent to Southwark Crown Court, with a pre-trial hearing listed on 16 December 2025.
The case signals a sharp escalation in criminal enforcement against the UK’s luxury goods and art-market regime, and an increasing focus on corporate entities.
Landmark Enforcement
The investigation, launched by HM Revenue & Customs (HMRC), appears to mark the first known criminal prosecution related to the UK’s ban on supplying luxury goods to persons connected with Russia, and the first corporate prosecution under UK Russia Sanctions Regulations.
Alongside Hauser & Wirth, a London-based art shipping company, Artay Rauchwerger Solomons Limited (formerly Art Logistics Limited), also faces charges. Prosecutors say the company breached the same export ban. The firm entered voluntary liquidation last year.
The companies are alleged to have made George Condo’s Escape from Humanity (2021) available to Popov, in contravention of the UK ban on the supply of luxury goods (including, but not limited to art, antiques, cars, jewellery and watches) valued over £250, to “persons connected with Russia”, effective April 2022. Both companies charged have denied the allegations.
It has been reported that the UK-registered gallery “strongly contests” the case and “intends to plead not guilty,” noting that the gallery is “fully committed to complying with all our legal obligations including sanctions.”
The charges appear to relate to Regulation 46B of the Russia (Sanctions) (EU Exit) Regulations 2019 (the Russia Sanctions Regulations), which prohibits the direct or indirect supply or delivery of luxury goods from a third country to Russia or making luxury goods available to “a person connected with Russia". Anyone convicted of the offence faces up to six months’ imprisonment and an unlimited monetary fine.
The prosecution will be required to prove not only that the recipient was "connected to Russia" within the specific meaning of the Russia Sanctions Regulations, but also that the artwork was either supplied directly or indirectly to a person connected to Russia, or otherwise made available to such a person, or for use within the Russian Federation. Statutory defences to Regulation 46B include demonstrating that the accused did not know and had no reasonable cause to suspect either that the goods were destined (or ultimately destined) for Russia; or that the person was connected with Russia; or that the goods were for use in Russia.
Art Market: Target for Law Enforcement
The Hauser & Wirth prosecution is just the latest in a rapidly developing era of enforcement for the sector. Since 2020, the UK art market has faced growing scrutiny and enforcement action. The second largest art market in the world, the UK is also the most stringently regulated, with neither of its competitor markets, the US and China, being subject to money laundering supervision.
Following the requirement for Art Market Participants (AMPs) to register for anti-money laundering supervision with HMRC by June 2021, more than 90 AMPs have been subject to regulatory action under money laundering regulations, with particular focus on galleries and auction houses.
Since the Russian invasion of Ukraine in 2022, sanctions restrictions have extended to luxury goods and works of art, significantly increasing the risk of money laundering breaches arising from underlying sanctions violations.
In 2024, the National Crime Agency (NCA) issued an Amber Alert to art storage facilities. Adrian Searle, then Director of the National Economic Crime Centre, called on the sector to “increase its vigilance and embrace their role as the gatekeeper of the legitimate art market”.
From May 2025, AMPs have been required to report suspected breaches of financial sanctions to the Office of Financial Sanctions Implementation (OFSI) where they know or reasonably suspect that a transaction (or linked transactions) involving works of art valued at €10,000 or more breaches sanctions regulations, or risk criminal prosecution.
Following a series of art market-related prosecutions in 2024–2025, including the conviction of Oghenochiko Ojiri for terrorist financing, the message from UK law enforcement in the Hauser & Wirth case is clear: sanctions and financial crime enforcement in the art market is now a top priority.
Who is in Scope?
In the art market, criminal prosecution-backed regulatory requirements including sanctions and money laundering laws, extend across a wide spectrum of art- and luxury goods-related businesses. Smaller firms, art advisers, dealerships, financiers, logistics, experts, advisers, and storage providers are affected, alongside the prominent auction houses and galleries.
Works of art covered by UK money laundering regulations include hand-made paintings, drawings, collages, decorative plaques, engravings, lithographs, prints, sculptures, tapestries, ceramics, enamels, and photographs. Sanctions regulations apply more broadly: to luxury "goods" in general, encompassing works of art, collectible items, antiques, jewellery, watches, silverware, precious stones, clothing, accessories, cosmetics and perfume, vehicles and luxury food and drink, and more. Whilst the Antiques, Antiquities, Digital Art and Jewellery sector may not face the same obligations under anti-money laundering regulations, care should be taken to ensure compliance with core money laundering laws and the wider sanctions regime.
Why this Matters — and What to do Now
Directors in the sector are expected to integrate anti-sanctions and money laundering compliance into strategic and operational decision-making, including sanctions screening, due diligence on clients and intermediaries, and robust reporting frameworks, applying government and industry guidance.
Recent joint guidance from the Crown Prosecution Service and the Serious Fraud Office indicates that a “genuinely proactive and effective corporate compliance programme” can reduce the risk of prosecution, and ultimately mitigate potential criminal penalties. Static, off-the-shelf policies and procedures will likely fall short of the heightened requirements on AMPs as businesses in the regulated sector, where the expectation is that compliance programmes will be designed with evidence-based risk assessments in mind.
This means: acquiring a deep understanding of the evolving regulatory environment (including key provisions in anti-sanctions and money laundering laws); assessing potential exposure across jurisdictions, customers, intermediaries; considering risks posed by the types of goods and services provided, transaction processes and delivery channels. It requires companies to embed robust compliance frameworks and a culture of due diligence throughout their organisations.
AMPs have rapidly become the focus of onerous regulatory obligations, with limited time to adapt. With the broad reach of potential offences (including indirect supply, third-country routing and "technical assistance") comes a heightened risk of criminal prosecution of companies and individuals, and exposure to unlimited fines and custodial sentences. Coupled with the advent in 2023 of company liability for economic crimes committed by senior managers, set to expand to all crimes in 2026 under the Crime and Policing Bill, the current trend shows no sign of abating.
Regulatory adherence is now in sharp focus — from board-level strategy, to operations and day-to-day transactions. For directors and executives, the time to act is now.
Further Reading:
OTSI guidance unpacked: What UK exporters need to know about Russian sanctions evasion
Expert Guide to Financial Sanctions Enforcement in the United Kingdom
CMS advises Weng Fine Art on sale of artnet | art market
For further information or assistance, please contact Kitty St Aubyn, Neal Gibson, Eoin O’Shea.
The authors are part of the CMS Art Law group, which brings together specialists in sanctions and economic crime, and practitioners with deep expertise in the art market and luxury goods sector across our UK and international offices.
Article co-authored by Evangeline Taylor, Trainee Solicitor.
