Fraudulent Contemporary Art Finds A Buoyant Marketplace On Ebay

If the latest Andy Warhol that you’ve spotted on eBay looks too good to be true, it probably is. ‘There’s a sucker born every minute’ — P T Barnum

Since the advent of the internet, art sales have been moving beyond the hallowed halls of auction houses such as Christie’s and Sotheby’s, and into the online domain.  Internet technology enables buyers to interact directly with sellers, thus dispensing with the middleman, at least in theory.  However, market liberalisation has not quite been the panacea that some were hoping it would be.  This is because the democratisation of art sales has been matched by the equally enthusiastic democratisation of art fraud.

According to the Alberto and Anette Giacometti Foundation, the global trade in illicit art now runs into billions of Euros each year.  Even museums have fallen prey to the odd counterfeit or three.  Fake art not only threatens the integrity of their art collections, but it compromises their cultural legacy.  In fact, the problem has now become so acute that, earlier this year, a new foundation (the International Union of Modern and Contemporary Masters (IUMCM)) was formed with the specific purpose of protecting museums, collectors and the art going public against art crime and forgery.

Statistics show that Internet auction fraud is on the rise across the world.  According to the US-based Internet Crime Complaint Centre (IC3) (a partnership between the FBI, the National White Collar Crime Center and the Bureau of Justice Assistance), at least a fourth of all reported cybercrimes in 2011 were perpetrated via online auction sites.  IC3 warns that criminals create an attractive deal by advertising phony goods for sale on the internet at prices that are below their book value.

Inexperienced buyers can get caught within the snare all too easily if they do not know what to look out for.  According to art fraud expert, Marc Carrier, not only should collectors always be wary when purchasing art as a general rule, but consumers should be hyper-vigilant when dealing with the relative anonymity of online auction sellers. However, the good news is that buyers can offer themselves a measure of protection by asking a few pointed questions before placing a bid on an artwork.  Here are some of the tips that Mr Carrier recommends:

Dead artists: prospective buyers should always ask for a valid certificate of authenticity (COA), signed by a living, recognized expert on the artist, designating the lot on sale.  At the very least, the auctioneer should provide the name and contact information of the signatory, so as to allow the buyer to call and verify the claim.

It’s all about the paper: purchasers should demand a provenance (a paper trail showing the work’s commercial journey from the artist’s studio to the seller).  A ‘valid provenance can include gallery stickers, catalogue listings, a photo of the artist with his work, or a verifiable list of previous owners’.  The more anecdotal the documented history of a work is, the less likely it is to be reliable.  In other words, the provenance should not read like a yarn that has been spun from a Harry Potter novel.

Never trust anyone who acts as the judge and the jury: authenticators should never play the dual role of a seller, no matter how long their CVs might be, or how many qualifications they may hold.

Cash under the table is a bad idea: art lovers should stay away from sellers who do not accept payment through a formal channel such as PayPal or a credit card, as these platforms offer a measure of protection against fraud.

Go with escrow: if large sums of money are involved, purchasers should consider paying the purchase price to a third party escrow agent, who may only pay the seller only upon the satisfactory conclusion of the sale.

Know who you are dealing with: it is advisable to get solid contact information for the seller (a physical address and a telephone number). An ephemeral and virtually anonymous e-mail address will be of little use in tracking down a dodgy seller.

 In addition, Artlyst recommends a few extra pointers:

Reputation may not be everything, but it goes a long way: serious buyers are likely to be far safer when dealing with a respected auction house that also has an established off-line presence.  A Sotheby’s or a Christies would be hard pressed to place its professional reputation on the line by flooding the market with fakes.

Exercise caution with trading only platforms: that means exercising extreme caution with websites like eBay.  These sites do not authenticate goods that are sold on their platform (eBay, for example, holds the seller solely responsible for this).  If the seller claims, “the autograph looks real to me”, there is a good chance that you’re being duped.

Perhaps another reason for collectors to be alert is that recovering one’s money from a fraudster can be a costly process, particularly if a dispute becomes a litigious.  Lawyers notoriously charge clients by the hour and their time can be more expensive than gold!

According to art fraud expert, Dr John Daab of the Fine Art Registry, prosecuting a fraud carries a heavy evidentiary weight that may be difficult to prove in court.  For one, the person committing the fraud must be aware that the item being sold is a fake, and must intend to commit fraud by passing it off as the original.  Subjective intention can be tricky to establish, particularly if the seller is not a certified art expert or protests his innocence.  For two, the prosecuting agency must have jurisdiction over the fraud.  In the transnational world of the internet, this is no mean feat to establish.  Thirdly, it is often incredibly difficult, if not impossible to identify the true culprit, as much art fraud is perpetuated over time, in many different parts of the world and involves several people.  According to Daab, the ‘common rejoinder from those at the top is that they had no idea that fraud took place on a lower level.’

Then again, you may be one of those buyers who simply does not care if the faux Salvador Dalí hanging on the wall is the real deal.  According to the BBC, a number of British consumers are happy to own fakes – whether they be fake handbags or other goods.

So, is the hullabaloo about art fraud much ado about nothing?  Not if you are buyer who is willing to dig deep into your pockets for good art.  Dr Daab recommends that if you are a serious collector, then there are few house rules that you should stick to: ‘always be skeptical, take your time to purchase, ask questions, [and] do your research thoroughly.’

 Words: Carla Raffinetti © Artlyst  Image courtesy: eBay

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