Art Forgery Is Easier Than Ever, a ponzi scheme Dec 12, 2019 13:44:31 GMT 4
Post by anenro on Dec 12, 2019 13:44:31 GMT 4
Art Forgery Is Easier Than Ever, and It’s a Great Way to Launder Money
John Myatt felt like his life was in free-fall.
It was the mid-1980s and at 41, he was a working painter who never made a splash—or a profit—in the London gallery scene. His wife left him, and he struggled to provide for his two young children.
So, he began to forge paintings.
Partnering with art dealer John Drewe, the duo sold more than an estimated 200 fraudulent pieces of art for millions of pounds, ensnaring some of the world’s most prestigious collectors, galleries, auction houses, and storied institutions, including London’s Tate Gallery.
It was one of the greatest art scandals of all time. Myatt spent countless hours making incredibly detailed “new” works in the style of Marc Chagall, Le Corbusier, Alberto Giacometti, Matisse, and Graham Sutherland, among others. He often scoured flea markets for paints, brushes, and canvases from an artist’s time period, in addition to obsessively studying their techniques.
He acknowledges his skill as a forger but says that much of pulling off the con was “about manipulating the publicity machine or just being in the right place at the right time” in making a sale; promoting the fake story of the creation of the image and how it fit into an artist’s body of work; and explaining how the piece had changed hands over the years.
Myatt, who served prison time and is now living and working as a painter in the United Kingdom, is among the handful of art forgers who say the very environment in which their past crimes flourished is, in many respects, just as fertile now. As art prices hit stratospheric highs and Trump-era momentum to regulate anything reaches record lows, the art world continues to be an under-explored haven for illicit activity, that often hangs, literally, in plain sight.
“I think it’s just as easy today,” Myatt said of forgery in a phone interview.
What is often dismissed as a largely victimless crime befitting of The Thomas Crown Affair (the one starring Pierce Brosnan and Rene Russo, not Steve McQueen and Faye Dunaway) may carry far higher stakes. Art forgery typically elicits images of the pearl-clasping super-rich with jaws dropped at fake Picassos, but the crime is also often linked to money laundering, tax evasion, and drug trafficking. It is the third highest-grossing criminal trade in the world over the last 40 years, according to the US Department of Justice and UNESCO, just behind drugs and weapons. Thomas Hoving, the former director of the Metropolitan Museum of Art, once estimated that 40 percent of the artwork in circulation was fake.
Driving criminal interest is the amount of cash that has been injected in the art world in the years since Myatt’s forgery heyday. In some respects, it mirrors the giant pools of money sloshing around in Manhattan or London real estate—funds that are relatively concentrated in a few hands spending it in a few places.
Critics contend there’s low incentive to catch criminals and that, in some cases, alleged victims may benefit from being in on the con. (Others are so desperate to be in the art market, they’re taking on massive debt to do so.)
The global art market in 2018 totaled some $67.4 billion, according to a joint report from Art Basel and UBS, an increase from $39.5 billion in recession-era 2009. And as the super wealthy look for more places to park money while diversifying their holdings, wealth managers and art dealers have welcomed new dollars, with some going so far to pitch (fee-heavy) hedge fund-like investment vehicles that pool money to acquire art.
That’s reaped fortunes for some, but not necessarily motivation to catch art criminals. Generally, art—be it real or fake—is being used to move money more than ever, former forgers, law enforcement agents, and experts suggest. And ironically, the forgers are among the most vocal.
“It was a mistake I made and it was time to come to do good things,” Myatt said. “To just face up to it.”
“I’m trying to do something good out of something bad.”
As Russian billionaire and avid art collector Dmitry Rybolovlev faced divorce from his wife, Elena, in 2008, the works that once proudly graced the walls of auction houses and made their way into his own collection were now a financial liability. So Rybolovlev set up an elaborate scheme to park his lofty art collection in an offshore entity, according to the Panama Papers.
Stowing away the works was no easy feat, as during his 23-year marriage, Rybolovlev, whom Forbes ranked as the 224th richest person in the world, had amassed a world-class collection that included works by Picasso, van Gogh, Monet, da Vinci, and Modigliani, among others. But as the marriage buckled, Rybolovlev moved the art to a shell company reportedly set up by the notorious and since-shuttered firm Mossack Fonseca in the British Virgin Islands. That took it out of Switzerland, part of an attempt to shield it from his wife’s name or the divorce court there. (Rybolovlev is involved in further litigation with his art dealer.)
While there’s no evidence Rybolovlev was dealing in forged works, it’s just one of many recent scandals involving the secretive strategies of the art world, and its role in moving money at a time when oligarchs across the world have come under harsh scrutiny. This past May, longtime titan dealer Mary Boone, who was convicted for tax evasion at her gallery, reported for a 30-month prison sentence—a rarity in an industry that often sees large amounts of money shifting hands. Art has a recurring role in the use of offshore shell companies, the Panama Papers showed, including allegations that the true buyers and sellers of major works may often be concealed.
The same goes for the ongoing saga of Jeffrey Epstein. As speculation mounted about Epstein’s actual net worth in the days leading up to his death, so, too, did questions around his art assets and how they may have fit into his alleged crimes. Among his art collection were “Parsing Bill,” a painting of Bill Clinton in a blue dress; a portrait of himself in a photorealistic prison scene; and a painting of a nude woman. It’s unclear what their market worth is, but Epstein was “amused to have in his house fake art which looked like real art,” longtime friend and art dealer Stuart Pivar told Mother Jones.
One reason fakes proliferate is simple: It’s relatively easy to forge a painting. And if it’s perceived as accurate, it can be hawked as an asset and—in some cases—get bought and sold with few or no questions asked.
Especially if the art is moving between hands that are trusted. Of the art authenticity frauds investigated by the FBI in the last three decades, an estimated 87 percent were perpetrated by art world “insiders,” a sort of Ponzi scheme via canvas. Among the most notable was the downfall of the Knoedler Gallery, a storied enterprise that closed its doors after 165 years in 2011 amid allegations that it had sold fake works of Mark Rothko, Jackson Pollock, Robert Motherwell, and others, often with little due diligence.