Sotheby's settles for $6.25 million over clients' tax evasion on art purchases after a New York investigation.

A source familiar with the settlement said that Sotheby's "always believed that the NYAG had the law and facts wrong."

Sotheby's will pay $6.25 million and adopt reforms to settle New York Attorney General Letitia James' lawsuit accusing the famed auction house of fraudulently helping clients avoid sales taxes on tens of millions of dollars of art purchases.

New York’s attorney general says the auction house helped eight collectors pose as art dealers to avoid paying taxes on art buys. Sotheby’s admits no wrongdoing.

Sotheby’s has agreed to pay $6.25 million to the state of New York and implement several reforms to resolve a tax fraud lawsuit filed by Attorney General Letitia James. The lawsuit accused the auction house of assisting clients in evading sales taxes on millions of dollars worth of art purchases.

The terms of the settlement in New York allowed Sotheby's to resolve the issue without admitting any wrongdoing

The auction house Sotheby's will pay $6.25 million to settle charges that it helped art buyers avoid paying taxes. It said the auction house encouraged buyers to state fraudulently that they were acquiring works for resale later.

New York’s attorney general said in a lawsuit that the auction house had helped collectors avoid tax payments on art purchases.