When you sell your home the paperwork details the sale, including your name, and the title search lists the names of the people who owned the property before you. But when someone sells an artwork at auction — even something worth $100 million, much more than your house — the identity is typically concealed. […] In finance, Treasury officials last year began asking banks to identify customers who set up accounts in names of shell companies. In real estate, they introduced a pilot program that requires the full identification of people who buy expensive properties in New York and Miami using cash and shell companies.
Once purchased, the art can disappear from view for years, even decades. A lot of the art bought at auctions goes to freeports – ultra-secure warehouses for the collections of millionaires and billionaires, ranging from Picassos and gold to vintage Ferraris and fine wine. The freeports, which exist in Switzerland, Luxembourg and Singapore, offer a variety of tax advantages because the goods stored in them are technically in transit. The Economist magazine reported that the freeport near the Geneva airport alone is thought to hold $100-billion (U.S.) of art.
Conventional X-ray can be used to detect earlier work present under the surface of a painting (see image, right). Sometimes artists will legitimately re-use their own canvasses, but if the painting on top is supposed to be from the 17th century, but the one underneath shows people in 19th-century dress, the scientist will assume the top painting is not authentic. Also x-rays can be used to view inside an object to determine if the object has been altered or repaired.
This scam works for the scammer because the transaction will take time due to the distance involved for both parties. To the unwary artist, the credit card transaction will go through, the art is shipped, only for the artist to find out later that credit card number was stolen and or that the check was no good and that the artist will not be receiving their funds. Then as a consequence of all this, the artist is out of their art and the costs involved, plus the cost of the shipping.
In paleontology and paleoanthropology, it is recognized that fossils can also move from their primary context and are sometimes found, apparently in-situ, in deposits to which they do not belong because they have been moved, for example, by the erosion of nearby but different outcrops. It is unclear how strictly paleontology maintains the provenience and provenance distinction. For example, a short glossary at a website (primarily aimed at young students) of the American Museum of Natural History treats the terms as synonymous, while scholarly paleontology works make frequent use of provenience in the same precise sense as used in archaeology and paleoanthropology.
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In March 2001 in Boston, meeting with an undercover agent posing as a drug dealer who showed interest in buying the putative Raphael, Stewart said he could move cash, exchange cash for gems in addition to art, and handle the resale of the Raphael, the agent's affidavit says. Eventually, the deal shifted to the Modigliani and Degas, the affidavit says, and Stewart fell out of the transaction.
Technical analysis, an objective approach, rests on an arsenal of equipment and tests. The fundamental principle is the comparison of a suspected work with a genuine work of the same artist or period. The suspected piece must show the same pigments or materials used and comparable age deterioration. Inconsistencies automatically cause the piece to be suspect. Oil paintings dry out and develop a crackle, bronzes oxidize, and ancient glass buried in the ground develops iridescent layers. The microscope is the most useful basic tool: a close examination of the physical condition often will show if the aging is genuine or has been artificially induced. The type of tools used by the artist can be detected from an examination of their telltale traces.
Despite all the studies and technical tests available, forgeries will still be made. The 20th-century art forger is far better equipped and much more knowledgeable than his predecessor. The demand for rare works of art has increased, and he will attempt to supply them. In collecting, whether by the private collector or by a museum, there comes a point when, after all the studies and all the tests are conducted, a decision has to be made as to whether or not to purchase a piece in question. The element of risk can be minimized but not eliminated. At this point, the collector should be ready to back his opinion with the purchase price. In order to acquire great pieces, particularly from newly discovered and relatively unknown cultures, it is necessary to take a calculated chance. The collector who has never bought a forgery probably has never bought a great piece of art.
Of course, beyond AML-related process concerns, any art dealer — just like any business person — always must remember that just about any financial transaction that involves proceeds known to have originated from illegal activity represents a criminal money laundering offense. Stated otherwise, even if the BSA is not expanded to include dealers in art and antiquities, those in the U.S. art industry still need to bear in mind, in extreme examples, the omnipresent federal criminal code. Sometimes, the provenance of the funds can be more critical than the provenance of the art.