In all, the shell companies linked to the oligarchs moved at least $91 million through the U.S. financial system after the sanctions were imposed, the report found.
"It is alarming and completely unacceptable that common sense regulations designed to prevent money laundering and the financing of terrorism do not apply if someone is purchasing a multimillion-dollar piece of art,” said U.S. Sen. Tom Carper, of Delaware, the subcommittee's top Democrat.
U.S. Sen. Rob Portman, Republican of Ohio, said he supports legislation to lift the “curtain of secrecy” that has made the art industry a preferred vehicle of money launderers.
The Rotenbergs could not be reached for comment. They have been the subject of U.S. sanctions since March 2014, singled out for their close ties to Putin. Arkady Rotenberg is a childhood friend and former judo sparring partner of Putin. His companies won billions in road contracts in Sochi, the host of the 2014 Winter Games.
Global art sales reached about $64 billion last year, with the United States accounting for nearly half the market. The industry remains unregulated in the U.S., however, attracting the likes of racketeers and money launderers.
Any reforms to the notoriously opaque art world will face vigorous opposition from well-heeled collectors “who don’t want anybody to know what they have,” said Robert Wittman, a former FBI agent who founded the bureau’s Art Crime Team.
U.S. art sales would plummet, Wittman said, if Congress followed the subcommittee's recommendation to extend the Bank Secrecy Act to businesses brokering high-value art transactions.
The report points to new anti-money laundering rules the European Union adopted recently for expensive art deals, including verifying the identity of the buyer and seller of the art. That directive followed the release of the so-called Panama Papers, a collection of more than 11 million secret financial documents that illustrated how some of the world's richest people hide their money.
The congressional report released Wednesday cited an email chain contained in the Panama Papers that listed nine shell companies in the British Virgin Islands linked to the Rotenbergs.
It said the Rotenbergs' art deals in the U.S. were facilitated by Gregory Baltser, an American citizen and art advisor based in Moscow who has “no plans to return to the United States.”
Baltser's attorney sent the congressional subcommittee a letter denying allegations that he did business with the Rotenbergs.