The Sotheby's 2018 AML Policy also lists various types of "activity which may cause concern," which it refers to as "red-flags."[1] The 2018 AML Policy states that "Sotheby's may not establish or maintain a business relationship or conclude a transaction with a client if at the time we are suspicious about money laundering, terrorist funding, the client, the source of funds or the property or that the transaction is part of tax evasion."[2] The 2018 AML Policy lists a number of different types of "red-flags," including, but not limited to the following:
- Client is unwilling to present requested identification documents, even after we have given the client reasonable explanations as to why we have asked for this information.
- Client refuses to provide complete and accurate contact information or business affiliations.
- Client gives evasive or incomplete answers to basic, routine questions.[3]
The 2018 AML Policy states that "all employees are required to report any suspicious transactions or suspected fraud to the Compliance Department."[4] Worldwide Policy on Compliance with Economic Sanctions Programs. Sotheby's 2016 Worldwide Policy Regarding Compliance with Economic Sanctions Programs (the "2016 Sanctions Policy") establishes that "no Sotheby's employee, wherever located, may transact with any blocked party."[5] The 2016 Sanctions Policy explains that OFAC:
administers and enforces U.S. economic and trade sanctions against targeted foreign countries, terrorists and terrorism-sponsoring organizations, international narcotics traffickers, and others. The regulations and executive orders administered and enforced by OFAC prohibit, among other things, the engagement by U.S. persons in transactions with, or the provision by U.S. persons of services to, certain entities and individuals on the Specifically Designated Nationals and other Blocked Persons List and other OFAC lists (collectively, the "OFAC Lists").[6]
The 2016 Sanctions Policy also states, "Sotheby's must ensure that no actual or potential client, no agent or intermediary, no beneficiary or principal whose name it acquires in the ordinary course of business . . . are named on the OFAC Lists, are owned 50 percent or more by one or more persons on the OFAC Lists, or any other
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