The importance of art due diligence against counterfeiting

3 min. reading
Culture, Investment / 3 September, 2018
The importance of art due diligence against counterfeiting


We all assume that counterfeiting in art exist, but to what extent is it a serious problem? Much more than we think. Many counterfeit works of art, for example a false lithograph by Miró, are sold on the Internet in small quantities, approximately $ 5,000, to numerous buyers who trust the seller's word and do not carry out any prior investigation - 'due diligence' - in the works. The idea of faking a work of art is not a new one. An anecdote from Vasari’s Lives of the Artists describes how the young Michelangelo carved a sculpture entitled Sleeping Cupidwhich, depending on who you believe, either he or the art dealer Baldessari del Milanese then aged artificially and sold to a cardinal as a Roman antique. Adding insult to injury, Michelangelo then discovered that not only had the dealer passed his work off as an antique, the artist had been paid 30 ducats for his troubles and the dealer had then sold the work on for 200 ducats, shorting Michelangelo by 170 ducats. What is most striking about this story is that, shocking as it might seem, it is not an unfamiliar idea. The art market is notoriously difficult to navigate, littered as it is with obscure traditions and an almost complete lack of regulation. In these murky waters unscrupulous dealers, agents and collectors prey on the unsuspecting and, given the purchase prices attached to many works of art, it is more important than ever to carry out as much due diligence as possible. One of the most high profile cases of art forgery to emerge in recent years is the case of Knoedler gallery and its former director, Ann Freedman. The gallery, before it closed in 2011 amidst lawsuits for fraud, was one of the oldest American galleries still operating, having been founded in 1846. Its name was trusted amongst collectors around the world. In 2011 it was discovered that a slew of works sold by the gallery between the years 1994 and 2008, including works by Mark Rothko, Jackson Pollock and Robert Motherwell, were in fact painted by a Chinese artist named Pei-Shen Quian living in Queens. Freedman, who had been director during those years, had been sourcing the works from a woman named Glafira Rosales, who claimed to be working for an anonymous collector who came to be known within the gallery as Mr X. Georgina Adam, author of Dark Side of the Boom, describes her surprise during her research and conversations with the FBI on the subject when she discovered that, quite apart from the high profile cases such as Knoedler and the recent Old Master fakes at Sotheby’s, many fake works of art. Important Steps to Take When Buying a Work of Art:  
  • Authentication: Have as many people as possible confirm the work’s authenticity, including leading experts, the artist’s foundation or estate. Check to see if the work is included in any catalogue raisonné of the artist.
  • Condition: Have the work physically inspected, either by yourself or by a trusted advisor. Have up-to-date condition reports made.
  • Title and Provenance: Confirm that the work is in good title i.e. is the legal property of the current owner and not stolen, war loot or missing. Perform an Art Loss Register search. Additionally, research the work’s provenance.
  • Legal compliance: Certain works of art are subject to legal restrictions such as cultural heritage and animal protection laws. Make sure that the sale of the work would not violate the laws of any jurisdiction.
  • Valuation: Double-check the valuation of the work by researching past sale results and other market factors. A trusted adviser is an invaluable asset here.