Art Crime-Not a Pretty Picture

Sim Middleton

There's a certain glamour associated with the "Art World."  The presumed expertise required to work among the connoisseurs may seem like an obstacle to the uninitiated investigator. But a crime is a crime whether it involves the theft of a priceless painting or a shipment of potatoes. One should conduct investigations with the focus on the crime, the evidence and the parties involved as much as on the object.

Certain crimes, in which a famous or extremely valuable work of art  goes missing, get lots of publicity. So does the smuggling of archaeological treasures from the Levant, Latin America, and more recently, from the Orient. As frequent as those crimes seem to be, the fact is that 90% of thefts and frauds involving art objects seldom turn up on the front pages of newspapers. This often has less to do with the value of the piece than it does with those entrusted with its care and how they see their interests being affected.

The art business, like all others, is about money, and there is a lot of money involved; recent estimates have the world art market valued at around 15 billion dollars (US). It is generally believed that the illegal movement of art around the world rivals the sales of narcotics and weapons in overall dollar value. Interpol has estimated the market in illegal art sales at around five billion dollars. This includes not only thefts and frauds involving the "Fine Arts" but also the looting of archaelogical sites and other cultural artifacts. Some experts think this figure is too low since placing a value on irreplaceable art treasures is difficult at best.

Japan's recent ratification of UNESCO's Convention on the Illicit Import, Export and Transfer of Ownership of Cultural Property, offers an example. This is an important event for collectors of art generally, and Asian art in particular.  Japan is a wealthy county and home to many collectors.  It has long been a major player in the international art market. Also, Japan has acquired large quantities of stolen art and cultural treasures as a result of conquests during its imperial period the first half of the last century. Colonial administrators in Korea, China and other areas under Japanese control confiscated and sent back to Japan thousands of works of art and cultural objects. By its ratification of the UNESCO Convention, Japan implicitly accepts responsibility for rectifying those unfortunate facts. This will prove difficult for Japan, a country that values its own cultural  treasures very highly. It portends something similar to what Germany and other Euopean countries have gone through in trying to handle claims by Holocaust survivors and others against those in possession of works of art seized by the Nazis prior to and during World War II.

Many of the stolen art and cultural properties are in the hands of private collectors, usually wealthy and powerful people who will be difficult to go after. A right first step has been taken. Now comes the hard and tedious part: identifying the stolen properties, their location and their rightful owners.

Most serious collectors acquire their artworks because they appreciate their beauty or their intrinsic creative qualities. A few do so in  the hopes of profiting from their appreciation in monetary value. This is where the gullibility and dishonesty of both buyers and sellers is usually most evident. It is also where forgeries and fraudulent transactions are often involved. Experts in the field adamantly and consistently warn that buyers of art should "Never, never, never buy art from someone who represents it as an investment and tells you that its value will certainly increase."

The controller of a shipping company in Los Angeles thought he had found a good investment when, at a conference on investment strategies, he heard a pitch by a Beverly Hills gallery on the rocketing values of fine art prints. Over drinks, the salesman, himself an investor, told of nearly doubling his money in just  two years as the value of "original prints" increased. after a visit to the Beverly Hills gallery and a flattering introduction to the "art world" by one of the partners, the controller was moved to invest over $50,000 from his company's retirement fund. The art he had purchased remained in the gallery on consignment to be sold when it had increased sufficiently in value. He received periodical updates advising him that his acquisitions had  appreciated as much as 83%! A very good investment indeed!

But a few months later the gallery went into bankruptcy, most of the artwork disappeared, and so did the money that had been invested in them. The partners who owned the place had a falling out, and with the breakup came the news that some of the artwork had been sold several times to different buyers without their knowledge. Then there was the matter of authenticity. The legitimacy of the remaining art could not be established. Police estimated that the losses to investors came to about 12.5 million dollars.  The shipping company did not recover any of the money invested from its retirement fund or any of the art it had purchased. The controller counted himself lucky that he lost only his job.

A woman in New Mexico also learned that art does not always appreciate in value, common perceptions to the contrary. In 1974 she came into possession of a small Nayarit statue (rough terra cotta figurines from the west coast of Mexico dating back to 100 A.D.). She had it appraised and was told it was worth $6500. Twenty years later her home was burglarized and among the things taken was her Mexican statue. She filed a claim with her homeowners insurance company which, in addition to the other losses, paid the assessed amount for the statue without question. Later, a friend, on hearing of the loss, told her with some vehemence, that she had been cheated! Any fool, the friend asserted, should know that pre-Columbian art had appreciated in value over the last 20 years and that her statue was probably worth much more now. Outraged, the woman recontacted her insurer and demanded justice. At first, the insurance company seriously considered negotiating a new settlement closer to the amount suggested by the woman's friend (about $20,000). Then, a claims adjuster decided to get another opinion. Research showed that Nayarit figures like the one in question were currently selling at Sotheby for $1,000 to 1,500 and that the top price paid for an unusually fine Nayarit piece had been just $7,700. With that, the insurance company decided to stand by its original settlement and, when confronted with the evidence, the woman conceded.

In fact, she was lucky to get what she did. The insurance company had every advantage had it chose to disallow the claim. Even if the statue had been valuable she was in no position to support her case:

     - Her previous appraiser was no longer available to substantiate his opinion.    

     - She had no documented provenance (history) to support her claim to the object's authenticity.

     - She had no photographs or other forensic evidence to establish the object's condition or even its existence.

The surprising thing here is that the insurer was so quick to settle the original claim and that when pushed, even seriously considered paying more without contesting the client's information.

Insurer's, and others who deal with art cases, should be aware that even where documentation exists it should be checked for reliability. Appraisals of art are widely suspect. Appraisers have engaged in notorious schemes involving fraudulent tax shelters and insurance scams. Even relatively honest appraisers have been pressured by collectors into over-valuing or under-valuing art objects depending on the purpose of the appraisal. The U.S. Internal Revenue Service Art Advisory Panel takes the view that "Appraising is a decidedly inexact and subjective business."

Perhaps, though, even an inexact appraisal would be better than none at all. An Associated Press story illustrates how insurance companies often contribute to their own victimization through a combination of ineptitude and the rush to sign up a client.

A man in Sacramento, California collected $410,000 from his insurance company after reporting the theft of two Italian Renaissance paintings from his home. The only proof of ownership he provided the agent who wrote his policy were two poor quality photographs. The snapshots of the paintings which the client identified as "Death and the Dragon" by Domenico Ghirlandaio and "Madonna con Bambino" by Pietro della Francesca were affixed to a pair of wooden crates. The client said the paintings were inside undergoing preservative treatments and could not be shown.

When the paintings were reported stolen three weeks later the insurance company said it raised suspicions but lacking evidence to the contrary, they paid the claim. An investigation was begun and, three years later, the "stolen" paintings were discovered in the Vatican's art gallery in Rome where they had been on display for the last 400 years. The photos used by the client, a former Alitalia employee, appeared to have been taken by him at the gallery. The paintings were in fact, "San Giorgio Che Occide Il Drago" by Paris Bordone and "Madonna Della Pera" by Alessandro Buonvicino, both dating to the 16th Century.

Art is not always appreciated, or stolen, just for the sake of profit. Some people love it for its own intrinsic qualities, enough to steal it if the opportunity presents itself. Usually, paintings and other decorative objects are the targets of such thieves but art takes many forms. Consider, for example, the rare book collections at the Honnold Library in the quiet, university town of Claremont, California. Housed in a large, relatively modern building on the Claremont University campus, its special collections were kept on the second and third floors behind a confusing array of hallways and cubicles. The collections were used mostly by college faculty and students for scholarly research. Access was permitted to others, however, if they produced some form of identification (usually a driver's license) and a reason for wanting to see a particular book. Service was the library's primary goal. That goal came under sudden scrutiny when, during a routine, though somewhat delayed, inventory, it was discovered that 500 rare volumes were missing! After reporting the loss to the police, embarrassed librarians commissioned a security survey to determine how so many books could vanish without a trace.

The survey found that while the alarm systems and locks were up to current standards, their purpose had been defeated by the failure of employees to follow simple procedures. Too many people, it turned out, were permitted to enter the collection unchecked and unaccounted for. Several extra keys had been issued to faculty members as a matter of convenience as they were regular patrons.  The locking mechanisms on the entry doors had been bypassed during business hours to make passage easier for employees and patrons. Plainly, the library staff's desire to serve overcame their concern for security. The books, 18th and 19th Century volumes on the history of exploration and transportation were considered irreplacable. Resignations were accepted and new security measures and equipment were put in place. "But the horse is gone," said one librarian sadly.

Three years later, acting on information provided by an association of librarians, the FBI arrested Stephen Blumberg, an heir to a real estate fortune living in a dilapidated mansion in Omaha, Nebraska. The house was crammed full with most of the 23,600 books he had stolen over the past 20 years. Blumberg had taken books from libraries all over the United States by simply walking in and carrying them out. Among his hoard of books were those from the Honnold.

Blumberg was an eccentric and an unusual case. But thefts of rare books and illustrated pages and color plates from books are not rare. In fact, losses from libraries and collections all over the world continues to pose a serious problem. Recently, an American priest was arrested in Ohio with color plates he had cut from the pages of rare old books in the Vatican's archives in Rome!

When it comes to works of art, all must be considered threatened. When it comes to suspects, all must be considered; as the recent indictments and convictions of executives and others in positions of trust at world famous art auction houses and museums proves. Complicating the job of protecting art is the secrecy which often surrounds disputes over the ownership, authenticity and disappearance of works of art. 

Protecting reputations, institutional and individual, is often paramount in the minds of those in charge of our cultural treasures. Museums, in particular, rely on their reputations for security amd as the final authority on what is or isn't fine art to encourage donations and support. There as in many a fine edifice, the dirt is kept well hidden.