Imagine a Picasso hanging on a wall in your home. The painting was appraised at $58,000, but you bought it for $6,000. A proud owner of a masterpiece, you’re probably thinking you got a deal of a lifetime. But what if it’s a fake?
The world of fraudulent art is growing quickly, raking in hundreds of millions of dollars a year. People are also becoming more sophisticated in the way they forge art and the way they sell it, according to the Federal Bureau of Investigation.
In a troubled economy, traditional investments don't do as well, so many look to art as a stable investment. In turn, scammers try to lure potential buyers, opening the door for more fraud.
Business is good for Emmanuel Benador, a third-generation art dealer who now consults for the FBI. For more than 18 years he was director of the Jan Krugier Gallery, which held one of the largest Picasso collections in the world.
“In matters of fakes, I see them almost every week,” Benador said. "The most commonly forged artists are Picasso, Chagall, Miro, Matisse, Giacometti, Warhol, Lichtenstein and Marino Marini."
For someone shopping for fine art, he recommends taking a few precautions before handing over your money.
First, don’t get taken in by a "bargain."
“When something is cheap or discounted significantly, often people think they are getting a great deal, but nine out of 10 times it is the wrong thing,” Benador said. “If there is something you like, go to official dealers that have dealt with that artist for a very long time.
Is it in good condition? Is it damaged? Have there been restorations? Find out if it has been in exhibitions or if there is literature on that piece.”
Answer all those questions before you make your purchase, he said.
“You wouldn’t attempt to buy a Louis Vuitton handbag off the street whose authenticity is entirely unknown, but rather from a legitimate retailer that bases their business off a model of integrity and ethics,” said Michele Senecal, executive director of the International Fine Print Dealers Association. “It’s important to get fine art from a legitimate source."
Unfortunately, it appears the victims of imprisoned dealer Kristine Eubanks either didn’t have or didn’t act on this information. Eubanks lured in customers with dreams of owning fine art at a fraction of the works’ true value.
Eubanks was able to reach millions of households at one time by televising “Fine Art Treasures Gallery,” an art auction that aired from 2002 to 2006 and sold works supposedly signed by such artists as Picasso, Chagall and Dali. In reality, they were selling bogus and unauthorized copies of artwork. Eubanks’ operation was a fraud raking in more than $20 million from more than 10,000 victims across the country.
As good as Eubanks was, buyers complained about poor quality but were refused refunds, leading to an undercover FBI investigation. Finally caught, Eubanks pleaded guilty in 2007 to conspiracy to commit mail fraud, wire fraud, interstate transportation of stolen property and filing a false income tax return. She is serving a six-year sentence.
Following Eubanks’ imprisonment, fraud is still a major concern in the art world.
Consumers have resources to verify artworks or dealers, including the International Fine Print Dealers Association and the Art Dealers Association of America. To be part of these associations, dealers must operate by a code of ethics and have years of experience and acknowledgement of their expertise by their peers.
Art might be a matter of taste, but quality and authenticity are not. Even when confident you are buying the real thing, other factors can affect its price. One pleasurable way to become a better art consumer is to educate your eye by going to museums.
"American Greed" premieres Wednesday, March 14 at 10p | 1a ET