Further, and as noted, other traditional vehicles for laundering money have become less attractive, thereby driving those who need a mechanism to launder large sums into the arms of the art world.  As we repeatedly have blogged, one of the most time-honored and relatively convenient vehicles for laundering — real estate — is under intense scrutiny and now is subject in the U.S. to the Financial Crimes Enforcement Network (“FinCEN”)’s ongoing Geographic Targeting Orders (these require U.S. title insurance companies in many parts of the U.S. to identify the natural persons behind legal entities used in purchases of residential real estate involving $300,000 or more and performed without a bank loan or similar form of external financing).
A qualified authority is a difficult concept, because it’s more than claiming (or seeming) to be an expert. This individual needs to have significant background and experience with the artist. Such as published papers about the artist, or perhaps they teach courses, or have catalogued essays about this artist. Of course the artist themselves, relatives, employees and descendents of the artist are understood as a qualified authority. Once you have all of your documents corroborated and stored in your Artwork Archive account, you can have peace of mind.
Price fluidity is one of the key advantages of using artwork for money laundering. Coupled with a lack of a regulatory body authorized to oversee the value of art, pricing art is effectively a free-for-all. For example, after 9/11, Americans yearned for nostalgia, including Norman Rockwell paintings. Some of his folksy paintings tripled in value — from $15 million in 2006 to $45 million seven years later.
Let’s get back to the real estate pilot program that lies at the heart of the Times’s confusion. That federal program, which may or may not be continued, relies upon mortgage title insurance companies to report to authorities the ultimate beneficial owner of any vehicle used to buy or sell very valuable real estate. It does not require the seller to reveal the beneficial owner to the buyer or vice versa.
A monumental sculptural forgery was a copy based on a Greek bronze statuette of a warrior of 470 bc, only five inches high and located in the Antikenabteilung, Berlin. The forgers made an eight-foot-high reproduction of it in terra-cotta and offered it as an Etruscan masterpiece. The resemblance was noted by the experts, who thought it to be an example of an Etruscan artist borrowing a Greek design motif. In 1961, after it had been in the Metropolitan Museum of Art in New York for 40 years, an analysis was made of the black glaze that covered the figure. It was found that the glaze contained as a colouring agent manganese, which never was used for this purpose in ancient times. Finally, Alfredo Adolfo Fioravanti confessed that he was the sole survivor of the three forgers.
The dating of an object by the study of radioactive decay of carbon-14 has had little application in the detection of art forgery because of the large quantities of material that must be destroyed. Thermoluminescent dating is based on the slight damage to all matter, including clays, by the faint nuclear radiation present in the earth. Magnetic dating of ceramic objects is based on the slow but perceptible shift of the earth’s magnetic field over the centuries.
   Artists have been copying the images and the styles of other artists for thousands of years. Up until around the 16th Century this was a common practice, used to pass down historical, religious and artistic tradition for future generations. Copying the work of others, and particularly the Masters, was a normal part of any artist's academic training. It still is, in major art schools, a normal and required part of an art student's cirriculum.
There are many ways to launder money, from the simple to the very complex. One of the most common techniques is to use a legitimate, cash-based business owned by a criminal organization. For example, if the organization owns a restaurant, it might inflate the daily cash receipts to funnel illegal cash through the restaurant and into the restaurant's bank account. After that, the funds can be withdrawn as needed. These types of businesses are often referred to as "fronts."
Money obtained illegally—from fraud, embezzlement, bribery, etc.—needs a hiding place. A huge deposit into a bank account, with no clear indication of where that money came from, is a red flag for the IRS. So instead of depositing dirty money, or holding onto it as cash, disreputable people will often turn the money into something else (cars, mansions) or filter it through a business so it comes out the other side looking like the profits of a legitimate enterprise.

Recent technology developments have aided collectors in assessing the temperature and humidity history or the wine which are two key components in establishing perfect provenance. For example, there are devices available that rest inside the wood case and can be read through the wood by waving a smartphone equipped with a simple app. These devices track the conditions the case has been exposed to for the duration of the battery life, which can be as long as 15 years, and sends a graph and high/low readings to the smartphone user. This takes the trust issue out of the hands of the owner and gives it to a third party for verification.
Evidence of provenance in the more general sense can be of importance in archaeology. Fakes are not unknown, and finds are sometimes removed from the context in which they were found without documentation, reducing their value to science. Even when apparently discovered in situ, archaeological finds are treated with caution. The provenience of a find may not be properly represented by the context in which it was found (e.g. due to stratigraphic layers being disturbed by erosion, earthquakes, or ancient reconstruction or other disturbance at a site. Artifacts can also be moved through looting as well as trade, far from their place of origin and long before modern rediscovery. Further research is often required to establish the true provenance of a find, and what the relationship is between the exact provenience and the overall provenance.
Speaking on the sidelines of the Art Business Conference, Pierre Valentin, head of the art law practice at London law firm Constantine Cannon, said laundering illicit funds through the art market was seductive because purchases at auctions "can be anonymous and it's a moveable asset. You can put the art on a private plane and take it anywhere. Plus there is no registration system for art."
As the trial nears, a few facts are certain. Rosales sold fraudulent art; after pleading guilty to nine counts that include wire fraud and money laundering, she agreed to cooperate in the investigation and is awaiting sentencing. Her boyfriend Bergantiños was arrested in Spain and remains there. Pei-Shen, who brilliantly forged work by the most lauded artists of the 20th century, is on the loose and untouchable somewhere in China.
Of course, certain countries already impose AML regulations on the art world. The European Union Commission issued its 5th Anti-Money Laundering Directive in June 2018, which must be implemented by Member States by January 2020, and which in part expands its coverage of “obliged entities” to persons trading in art, acting as intermediaries in the trade of art, or storing art in freeports, if the value of the transaction or a group of linked transactions equals €10,000 or more. In the United States, although the BSA already applies to dealers in precious metals, stones and jewels, and thereby requires them to file Suspicious Activity Reports and comply with other AML obligations, no such rules currently apply to U.S. dealers in art.

Provenance research, or the history of ownership of a work of art, is a regular part of museum practice. The goal of provenance research is to trace the history of an artwork through its owners and locations, from the moment of its creation until today. The Nelson-Atkins Museum of Art conducts regular, ongoing provenance research on the artwork in its collection.
However, federal criminal prosecutions against art forgers are seldom brought due in part to high evidentiary burdens and competing law enforcement priorities. For example, internet art frauds now appear in the federal courts' rulings that one may study in the PACER court records. Some frauds are done on the internet on a popular auction websites. Traces are readily available to see the full extent of the frauds from a forensic standpoint or even basic due diligence of professionals who may research matters including sources of PACER / enforcing authority records and on the internet.
Provenance – also known as "custodial history" – is a core concept of archival science and archival processing. The term refers to the individuals, groups, or organizations that originally created or received the items in an accumulation of records, and to the items' subsequent chain of custody.[16] The principle of provenance (sometimes also termed the principle of archival integrity or respect des fonds) stipulates that records originating from a common source (or fonds) should be kept together – where practicable, physically; but in all cases intellectually, in the way in which they are catalogued and arranged in finding aids. Conversely, records of different provenance should be preserved and documented separately. In archival practice, proof of provenance is provided by the operation of control systems that document the history of records kept in archives, including details of amendments made to them. The authority of an archival document or set of documents of which the provenance is uncertain (because of gaps in the recorded chain of custody) will be considered to be severely compromised.

Glafira Rosales, an obscure Long Island art dealer, her boyfriend, and his brother enlisted Pei-Shen Qian, a Chinese artist in Queens, to paint Abstract Expressionist canvases in the style of such masters as Jackson Pollock, Mark Rothko, Robert Motherwell, and others. The venerable Knoedler gallery, which closed in 2011 as the forgeries came to light, still claims they believed Rosales’s story that the works were part of an undocumented collection sold directly by the artists to an anonymous “Mr. X.”
John (American, 1777-1851) and Hugh (American, 1781-1830) Finlay, Card Tables in the Neo-Classical Taste, c. 1825, Mahogany, maple, pine, and poplar, painted and paint-grained rosewood, and gilded, with gilt-brass toe caps and castors and die-stamped rosettes, and red velvet in the wells, 28 7/8 x 35 7/8 x 17 ¾ in. (73.34 x 91.12 x 45.09 cm), Mr. and Mrs. Robert J. Barber Art Fund, 2016.3-.4.
Archaeologists ... don't care who owned an object—they are more interested in the context of an object within the community of its (mostly original) users. ... [W]e are interested in why a Roman coin turned up in a shipwreck 400 years after it was made; while art historians don't really care, since they can generally figure out what mint a coin came from by the information stamped on its surface. "It's a Roman coin, what else do we need to know?" says an art historian; "The shipping trade in the Mediterranean region during late Roman times" says an archaeologist. ... [P]rovenance for an art historian is important to establish ownership, but provenience is interesting to an archaeologist to establish meaning.
In transactions of old wine with the potential of improving with age, the issue of provenance has a large bearing on the assessment of the contents of a bottle, both in terms of quality and the risk of wine fraud. A documented history of wine cellar conditions is valuable in estimating the quality of an older vintage due to the fragile nature of wine.[24]
In seeking to revoke the sale based on an “incomplete” provenance, the buyer claimed that the provenance constituted a warranty under the Uniform Commercial Code (“UCC”) because it was part of the “basis of the bargain.” Under UCC § 2-313(1)(a), “[a]ny affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.” Section 2-313(1)(b) provides that “[a]ny description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.” It is hard to argue that these sections are not worded broadly enough to encompass the provenance of art work, assuming that provenance was considered part of “the basis of the bargain” when the artwork was sold. The bad news for the seller is that determining whether the provenance was part of “the basis of the bargain” in a given transaction will likely be a question of fact for a jury to decide. That means that, absent precautionary measures such as an express disclaimer as to completeness and accuracy, the question of whether the provenance provided by the seller in an art sale constitutes a warranty will not be decided until after a good deal of expensive litigation. And it is certain that if the provenance is arguably misrepresented or incomplete, the buyer will be able to produce an “expert” to testify about the importance of provenance in the art world, all in support of the buyer’s argument that the given provenance was part of the basis of the bargain.
Checked it out? Good, isn't it? Historical fiction based on the largest unsolved art heist in history? An artist agreeing to forge a famous painting from the original? And the original might actually *already* be a forgery? Seriously, how can I not read this book? The back text here is a great example of what back text should be: enough to really p ...more

Art specialists with expertise in art authentication began to surface in the art world during the late 1850s. At that time they were usually historians or museum curators, writing books about paintings, sculpture, and other art forms. Communication among the different specialties was poor, and they often made mistakes when authenticating pieces. While many books and art catalogues were published prior to 1900, many were not widely circulated, and often did not contain information about contemporary artwork. In addition, specialists prior to the 1900s lacked many of the important technological means that experts use to authenticate art today. Traditionally, a work in an artist's "catalogue raisonné" has been key to confirming the authenticity, and thus value. Omission from an artist's catalogue raisonné indeed can prove fatal to any potential resale of a work, notwithstanding any proof the owner may offer to support authenticity.[20]
The pure fabrication is a kind of forgery that defies classification, often because there is no false attribution and the motives are difficult to ascertain. An example of this is the Historia regum Britanniae (1135–38) of Geoffrey of Monmouth (died 1155), a pseudo-historian who compounded stories from Celtic mythology and classical and biblical sources into a fictitious history of ancient Britain. The book became one of the most popular of the Middle Ages and was the basis for some Arthurian legends recounted in medieval romance and epic.
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James Martin’s expert report shows the signatures from four Knoedler paintings that were purported Jackson Pollocks. The top two signatures are quite similar. The bottom right signature shows signs that the name was first traced onto the canvas using a sharp tool, and is very similar to the signature on the bottom left, which is misspelled “Pollok.” Courtesy of James Martin.
Law enforcement officials in the United States and abroad say “Hannibal” is just one of thousands of valuable artworks being used by criminals to hide illicit profits and illegally transfer assets around the globe. As other traditional money-laundering techniques have come under closer scrutiny, smugglers, drug traffickers, arms dealers and the like have increasingly turned to the famously opaque art market, officials say.
At $8.3 million, it was the most expensive painting that the De Soles — the chairman of Tom Ford International and his socialite wife — had ever purchased, but they were getting what one source calls “a pretty sweet deal.” Weeks before the sale closed, a work by Rothko sold for $17,368,000 at Sotheby’s. Knoedler drew up a warranty of “authenticity and good value,” and the De Soles proudly hung Rothko’s “Untitled 1956” inside their luxurious Hilton Head, SC, home.
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