Hobby Lobby has agreed to forfeit thousands of illegally smuggled ancient Iraqi artifacts, the company and the Department of Justice said on July 5. (Amber Ferguson/The Washington Post)

The arts-and-crafts retailer Hobby Lobby has agreed to pay a $3 million fine for illegally importing thousands of ancient Iraqi clay artifacts smuggled into the United States, federal prosecutors said Wednesday.

In addition to the fine, Hobby Lobby will forfeit thousands of clay bullae, cuneiform tablets and cylinder seals that were falsely labeled and shipped to the company through the United Arab Emirates and Israel, according to a civil complaint and settlement agreement in the U.S. District Court for the Eastern District of New York.

Cuneiform is an ancient writing system that involved carving inscriptions into clay or stone. Cylinder seals were used to roll impressions into clay. Clay bullae are balls of clay with seals imprinted on the surface, used to show a document’s authenticity.

The Oklahoma-based company bought more than 5,500 artifacts that originated in modern-day Iraq for $1.6 million in December 2010 from an unidentified dealer in an acquisition prosecutors said was “fraught with red flags.” According to the complaint, Hobby Lobby got conflicting information about where the artifacts had been stored and never met or communicated with the dealer selling them. When it came time to pay, the company wired money to seven separate bank accounts.

“American collectors and importers must ensure compliance with laws and regulations that require truthful declarations to U.S. Customs and Border Protection, so that Customs officers are able to scrutinize cultural property crossing our borders and prevent the inappropriate entry of such property,” acting U.S. attorney Bridget M. Rohde said in a statement.

Hobby Lobby, whose owners are evangelical Christians, said it began collecting a “variety of Bibles and other artifacts” several years ago with the goal of preserving them for future generations. In a statement Wednesday, the company said it “did not fully appreciate the complexities of the acquisitions process” and relied on dealers who did not understand how to properly ship the items.

“We should have exercised more oversight and carefully questioned how the acquisitions were handled,” Hobby Lobby President Steve Green said in the statement.

A clay bulla. (U.S. Department of Justice)

Hobby Lobby’s owners portray their company as a Christian business and are known for supporting Christian causes. Green is one of the driving forces behind the Museum of the Bible, a 430,000-square-foot facility in Washington, D.C., that is set to open in the fall and will reportedly house thousands of biblical artifacts and texts.

In 2014, Hobby Lobby became a symbol in debate over religious freedom after it prevailed in a landmark U.S. Supreme Court case that found family-owned corporations do not have to pay for contraception coverage under the Affordable Care Act if it violates their sincerely held religious beliefs.

According to the complaint, Hobby Lobby began collecting a range of historically significant manuscripts and other antiquities in 2009. The following July, Green traveled with a consultant to the United Arab Emirates, where they inspected a large cache of cuneiform tablets and other artifacts.

Two Israeli antiquities dealers and one from the United Arab Emirates attended the July 2010 inspection with Hobby Lobby’s president and consultant. At the meeting, the complaint says, the artifacts were displayed informally, “spread on the floor, arranged in layers on a coffee table, and packed loosely in cardboard boxes, in many instances with little or no protective material between them.”

The dealers said the items were from the family collection of a third dealer who was not present, according to the complaint. They later sent Hobby Lobby a provenance statement — a guarantee of authenticity — indicating that the artifacts were legally acquired in the 1960s from local markets.

After returning to the United States, the complaint says, Hobby Lobby’s president and in-house lawyer spoke with an expert on cultural property law who warned them that antiquities from ancient Iraq may have been looted from archaeological sites. In a memo, the expert told them that any items of Iraqi origin that were not properly declared could be seized by customs officials.

Hobby Lobby proceeded with the sale. Starting in late 2010, a United Arab Emirates-based dealer sent 10 packages to three different Hobby Lobby addresses in Oklahoma City, with shipping labels reading “ceramic tiles” or “clay tiles (sample),” according to the complaint. No formal entries were made for the shipments. Prosecutors said the use of multiple addresses was “consistent with methods used by cultural property smugglers to avoid scrutiny by Customs.”

U.S. Customs and Border Protection later intercepted five additional packages, all of them falsely declaring that the artifacts inside came from Turkey. A final shipment containing about 1,000 clay bullae arrived at one of Hobby Lobby’s addresses from Israel in September 2011. That one also misrepresented the artifacts’ country of origin, according to the complaint.

Angel M. Melendez, a U.S. Immigration and Customs Enforcement special agent, said in a statement Wednesday: “While some may put a price on these artifacts, the people of Iraq consider them priceless.”

Correction: This story has been updated to remove the suggestion that the artifacts forfeited by Hobby Lobby were smuggled directly from Iraq.

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