The Hobby Lobby smuggling scandal is the series of events starting in 2009 when representatives of Hobby Lobby organized archaeological looting in Iraq to present smuggled artifacts to the Museum of the Bible. In 2017 the United States District Court for the Eastern District of New York directed Hobby Lobby to return the artifacts and pay a fine of US$3,000,000. Hobby Lobby returned the items in May 2018.

In December 2010, Hobby Lobby purchased $1.6 million worth of Iraqi artifacts from dealers in the United Arab Emirates, presumably to be included in the Museum of the Bible—a Washington, D.C. museum being backed by David Green. The company went on with the purchase despite concerns from lawyers over the uncertain origin of the artifacts, and the possibility that they could have been looted. The shipments included tablets inscribed with cuneiform writing, which were misrepresented on declarations as being ceramic and clay tile samples, and contained false designations of origin stating that the objects were from Turkey and Israel. The company became subject to investigation by the U.S. government for these actions.^{[1][2][3][4][5]}

According to a Justice Department press release, "In October 2010, an expert on cultural property law retained by Hobby Lobby warned the company that the acquisition of cultural property likely from Iraq, including cuneiform tablets and cylinder seals, carries a risk that such objects may have been looted from archaeological sites in Iraq. The expert also advised Hobby Lobby to review its collection of antiquities for any objects of Iraqi origin and to verify that their country of origin was properly declared at the time of importation into the United States. The expert warned Hobby Lobby that an improper declaration of country of origin for cultural property could lead to seizure and forfeiture of the artifacts by CBP."^[6]

On July 5, 2017, Hobby Lobby consented to a settlement requiring forfeiture of the artifacts and payment of a fine of $3 million.^[4][7] Israeli police have arrested five antiquities dealers, in connection with the illegal importation of ancient artifacts by Hobby Lobby.^[4][8]

From years before the museum opened, concerns were raised regarding the provenance of the artifacts in the collection. In response to this issue, the museum appointed David Trobisch, a European scholar, as director of the collection and charged him with addressing the concerns of critics.^[9][10]

More recently, the founders of the museum were forced to relinquish thousands of artifacts because they were smuggled out of Iraq via the United Arab Emirates. Notably Hobby Lobby neglected to confirm where the artifacts had been stored.^{[citation needed]} Hobby Lobby was forced to relinquish 5,500 artifacts and to pay a $3 million settlement.^[11][12] The Justice Department discussed archaeological looting in Iraq:

In October 2010, an expert on cultural property law retained by Hobby Lobby warned the company that the acquisition of cultural property likely from Iraq, including cuneiform tablets and cylinder seals, carries a risk that such objects may have been looted from archaeological sites in Iraq. The expert also advised Hobby Lobby to review its collection of antiquities for any objects of Iraqi origin and to verify that their country of origin was properly declared at the time of importation into the United States. The expert warned Hobby Lobby that an improper declaration of country of origin for cultural property could lead to seizure and forfeiture of the artifacts by CBP U.S. Customs and Border Protection.

The museum responded by noting that they are a separate organization which "was not a party to either the investigation or the settlement."^[13] The museum says they voluntarily "adhere to the current Association of Art Museum Directors' standards on the Acquisition of Archaeological Material and Ancient Art, as well as guidelines set forth by the American Alliance of Museums" and, further, that "none of the artifacts identified in the settlement are part of the Museum's collection, nor have they ever been."^[13]

• United States Files Civil Action To Forfeit Thousands Of Ancient Iraqi Artifacts Imported By Hobby Lobby, the July 2017 United States government complaint