Will Internal Audits be the New Norm for Museums?

This Kushan Buddha statue, bought by the National Gallery in Australia is one of the "questionable" objects flagged in the museum's internal review
This Kushan Buddha statue, bought by the National Gallery in Australia is one of the “questionable” objects flagged in the museum’s internal review

Good news for those who want to encourage museums to thoroughly examine their collections. The National Gallery of Australia has determined that 22 antiquities from Asia have “insufficient or questionable provenance documentation.”

Chasing Aphrodite has a comprehensive roundup, including the dealers and collectors who had possession of these objects:

Continue reading “Will Internal Audits be the New Norm for Museums?”

A Call for more art market diligence

Gerald Fitzgerald argues that we need to increase the level of due diligence in the art market:

I propose a levy of 1% or less on the sale or auction of any artwork above a certain value—say, $5,000—earmarked fully for the creation and support of a Center for Provenance Research. Questions of inadequate provenance would be submitted to CPR review prior to further sale. This independent, nonprofit research center would apply acknowledged standards using instant accessibility to an electronic database uniting all relevant sources. A staggering, global collection is housed at the Family Library in Salt Lake City, UT, which is now digitizing genealogical records in more than 45 countries. In March 2014, the Vatican announced that it will begin to digitize 1.5 million pages of its manuscript collection of more than 41 million pages, a project it has outsourced to the Japanese technology group NTT Data. Other fields—medicine, music, and so on—are being accessed instantly, electronically; every major museum has its libraries being digitized.

No one has done so for provenance research. Overseen by a board of directors drawn internationally from museums, auction houses, dealers, and collectors, the CPR could be a recognized standard for due diligence now missing entirely. I estimate that it would take about 10 years to devise, fund, and implement the CPR. The levy ought to begin immediately following market commitment to the project, allowing funds to accrue throughout the planning and development stages. The need for a global CPR is underscored by the major auction houses continuing expansion into emerging markets, such as those of China and India.

I agree that diligence needs to be increased, and this seems like a very good idea to get it started.

Gerald Fitzgerald, Opinion: Give Us CPR, Art Papers (Jun. 2014), http://www.artpapers.org/feature_articles/feature3_2014_0506.html.

New York Lawsuit shows due diligence pays, as much as $5m

The Shiva bronze statue which the National Gallery of Australia purchased in 2008 for $5 million
The Shiva bronze statue which the National Gallery of Australia purchased in 2008 for $5 million

A lawsuit filed in New York State court last week could provide one of the strongest disincentives yet to dealing in looted cultural objects. Subhash Kapoor‘s gallery in New York, Art of the Past, has been sued for a laundry list of private law violations; including “fraud, rescission, unjust enrichment, contractual indemnity, and breach of contract” based on the sale of this bronze statue known as Shiva as Lord of the Dance (Nataraja). The plaintiff is the Australian gallery which purchased this work in 2008.

This lawsuit is exactly what should happen when a purchaser with clean hands purchases a work of art from a dealer who knew that a work of art was looted or stolen. I’ve argued before that acquisitions like this defraud the legitimate trade in works of art, and also corrupt our understanding of history.

Chasing Aphrodite asks:

The NGA lawsuit, to our knowledge, is unprecedented. American museums and private collectors have returned hundreds of looted objects to Italy, Greece, Turkey, India, Cambodia and other countries in recent years. In nearly all those cases, dealers had provided standard warranties guaranteeing good title to the objects. And yet not one museum or collector had filed a similar lawsuit…that we know of.

 

So why haven’t lawsuits like this occurred with more regularity? Here’s why I think they have been rare. They should be happening every time looted art is repatriated.  As any first year law student learns, if someone sells you stolen property, every legal system allows you to bring an action against the launderer of stolen property. But this has not happened in the antiquities trade for a couple reasons. First, many curators and museum officials had too much knowledge of the illicitness of objects they were acquiring. A lawsuit like this would have embarrased institutions like the Getty or the Met or the MFA in Boston by raising uncomfortable question about what due diligence was taken before an acquisition. In this case, it seems as if the National Gallery of Australia is comfortable in defending its due diligence procedures to a court. The NGA alleges in its complaint that it undertook due diligence procedures, while also relying on the warranties given by Art of the Past. But the NGA asked the Art loss register if the statue was stolen, examined letters from the previous owner of the statue, consulted the ‘Tamil Nadu Police website’, checked the records produced by the Archaeological Survey of India, and finally consulted with a bronze expert in India who supported the acquisition.

Perhaps another reason that a suit like this is unique, is the secret nature of the art trade itself. Buyers and sellers are anonymous. But that is changing. When you can trace the path of material through the various purchasers, the market for illicit material shrinks. And that is a very good thing, and why we should all watch this suit in New York closely.

NATIONAL GALLERY OF AUSTRALIA v. ART OF THE PAST INC, Docket No. 650395/2014 (N.Y. Sup Ct. Feb. 06, 2014)

Guns, Degas, and Legal Disputes

A work purportedly by Degas, at the center of a legal dispute in Florida

Details of an odd art dispute are unfolding in Florida. A law firm is being sued by its client for failure to release this work, allegedly by Degas. All the red flags are up in this case, yet it wasn’t the auction house Sotheby’s which delayed the auction, but rather a dispute over legal fees and a $1 million retainer.

In August, a pleasantly cool month in Chile, Bonati was in Santiago, where he and McInnis boarded the chartered, nine-seat Cessna. The plane refueled in Ecuador and landed in Fort Lauderdale after the 4,000-mile flight.
As the men headed for the terminal, they drew suspicion because of what the law firm later called their “bizarre” conduct.
“Bonati carried the multi-million dollar painting in his arms as the pair made their way across the tarmac . . . while McInnis walked alongside with a gun holstered at his waist,” the firm said in a court filing. 

“Bonati was also carrying in excess of $10,000 in cash on his person, a sum which he did not declare to U.S. Customs as required by law.” 

Anyone taking more than $10,000 in currency into or out of the country must file a report with customs. 

Paintings and other original works of art also must be declared, though most are allowed to enter the United States duty-free. But with art theft a major international problem, U.S. Immigration and Customs Enforcement has stepped up efforts to ascertain the ownership of potentially valuable works. 

In January, the agency returned to France a Degas painting stolen from a museum there in 1973. It resurfaced last fall in the catalog of a Sotheby’s auction in New York. 

That episode “shows why we take an interest in these kind of cases and if it is stolen, returning it to its rightful owner,” says Danielle Bennett, an ICE spokeswoman.

  1. Susan Taylor Martin, Doctor’s legal battle reveals potential art trove, St. Petersburg Times, March 6, 2011, http://www.tampabay.com/news/courts/civil/doctors-legal-battle-reveals-potential-art-trove/1155579 (last visited Mar 8, 2011).
Questions or Comments? Email me at derek.fincham@gmail.com

The Good Faith Acquisition of Antiquities

I have posted on SSRN the most recent version of my paper, Towards a Rigorous Standard for the Good Faith Acquisition of Antiquities of Antiquities, forthcoming in 37 Syracuse Journal of International Law and Commerce (2009).  Here is the abstract:

When antiquities are acquired without a rigorous due diligence process, that acquisition defrauds our heritage by distorting the archaeological record; causing potential harm to other legitimate acquisition of antiquities; perverting the important role museums play in society; and ultimately warping the understanding of our common cultural heritage.  Fraud occurs when a defendant intentionally deceives another.  Given the flood of scandals plaguing museums, collectors, and dealers, we can state now with some confidence that many of these individuals have committed a fraud on our collective human heritage.   

Combating this fraud is particularly difficult.  Though an existing body of law prohibits and punishes a variety of activities which further the illicit trade, these measures are severely hampered by the mystery surrounding antiquities transactions.  With increased scrutiny and a more rigorous and diligent title enquiry by buyers and sellers, these legal measures will become far more effective.  At present, details regarding authenticity, title, or even more basic questions such as the origin of an object are intentionally hidden and disguised from public view.

Good faith has been used to merely promote commercial convenience and economic efficiency.  This article proposes a new theoretical foundation for increased scrutiny of the antiquities trade by constructing a broad basis for the recognition of good faith as a mechanism for eliminating the illicit trade in antiquities.  This article articulates three ways in which good faith can play a meaningful role in the trade and transfer of antiquities by examining fraud, limitations periods, and public pressure generally. A strong case for reform can be made if we consider that a family of art forgers living in modest public housing in Bolton, England can easily fool some of the World’s leading cultural institutions.

Questions or Comments? Email me at derek.fincham@gmail.com

Forgeries of Russian avant-garde

File:Artwork by El Lissitzky 1919.jpgKonstantin Akinsha and Sylvia Hochfield report for ARTnews on the slew of Russian avant-garde paintings which were alleged to be fakes. An exhabition at the Château Museum in Tours, France was slated to exhibit 192 Russian avant-garde paintings was abruptly canceled in March, three days before its opening. Russian avant-garde is the body of modern art which was created roughly between 1890 and 1930. Pictured here is an authentic (I think) lithograph by El Lissitzky, Beat the white with the Red wedge (c. 1919).

It seems there is a slew of these forged works. Natalia Kournikova of the Kournikova Gallery in Moscow notes in the piece that “we can say that almost every artist whose prices have risen has become the victim of fake makers.” Alla Rosenfeld, curator of the Norton Dodge Collection of Soviet Nonconformist Art at Rutgers University from 1992 to 2006 and former vice president of the Russian art department at Sotheby’s New York says “There are more fakes than genuine pictures”:

Fake icons and “fauxbergé” trinkets have bedeviled the art market for generations, but the escalating demand for Russian art in the last two decades has led to more ingenious abuses. For a while, “Russified” pictures—minor 19th-century European landscapes or portraits doctored to look Russian—flooded galleries and antique dealerships in Moscow and made their way to the West, appearing even at major auctions. But it has been Russian modernism—art from the first three decades of the 20th century—that has attracted the most Western collectors and consequently the most forgeries.

Hundreds of works have appeared in recent years at auction houses and in galleries all over Europe, from Munich to Madrid. These works have very sketchy provenances in which certain assertions are repeated again and again: the works are said to have come from hitherto unknown private collections or to have been smuggled to Israel by immigrants in the ’70s or to have been deaccessioned by provincial museums in the former Soviet republics—although this practice was strictly forbidden—or to have been confiscated and hidden for a half century by the former KGB (the secret police), although experts say there is not a single documented case of avant-garde works emerging from KGB vaults.

The means with which these forged works are given clean histories are familiar: publication in academic works or exhibition catalogs; previous owners who have suddenly disappeared or are unavailable to corroborate their story; questionable certification by Russian art historians, and a general lack of sufficient documentation. Again, it appears as if a segment of the art trade continues to skirt the rules. As I’ve argued elsewhere, we need a renewed emphasis on the means by which buyers of art acquire good faith status.

Questions or Comments? Email me at derek.fincham@gmail.com

My Work in Progress on Increased Scrutiny of Good Faith

I’ve posted on SSRN a work in progress, Fraud on Our Heritage: Towards a Rigorous Standard for the Good Faith Acquisition of Antiquities. I attempt to make a case for heightened standards for good faith, particularly in the context of museums and antiquities. I would be delighted to hear any thoughts/reactions to the piece. Here is the abstract:

If a family of art forgers living in modest public housing in Bolton, England can easily fool some of the World’s leading cultural institutions, then surely the current state of the antiquities market must be badly broken. Ideally a diligent enquiry before a purchase confers good faith status, allows purchasers to acquire good title, and gives the legal right to seek compensation from an unscrupulous seller. Despite these important advantages, good faith has been used merely to promote commercial convenience and economic efficiency. This article proposes a new theoretical foundation for increased scrutiny of the antiquities trade by constructing a broad basis for the recognition of good faith as a mechanism for eliminating the illicit trade in antiquities.

Though an existing body of law prohibits and punishes a variety of activities which further the illicit trade, these measures are severely hampered by the mystery surrounding antiquities transactions. With increased scrutiny and a more rigorous and diligent analysis, these legal measures will become far more effective. At present, details regarding authenticity, title, or even more basic questions such as the origin of an object are intentionally hidden and disguised from public view. When an object is acquired without a rigorous due diligence process, that acquisition defrauds our heritage by distorting the archaeological record; harms the legitimate acquisition of antiquities; perverts the important role museums play in society; and ultimately warps the understanding of our common cultural heritage.

Consequently, this article proposes a theoretical underpinning for a new and rigorous standard for the acquisition of art and antiquities. In so doing, it develops a theory which can successfully navigate the secrecy surrounding the trade and acquisition of antiquities. It concludes by offering a critique of the recent attempts by law and economics scholars to analyze the antiquities trade and concludes that they may offer some useful policy models so long as they account for the preservation of heritage and context in their “efficiency” models.

Questions or Comments? Email me at derek.fincham@gmail.com