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Criminal Art Dealers and Their Legal Consequences

Credit: PxHere

Art Dealers are a foundational aspect of the art market. As middlemen, dealers are the chain that connects artists, institutions, and buyers. Buyers often have plentiful financial resources but sometimes lack the necessary time, connections, or knowledge to purchase art alone. The amount of money involved, as well as the opaque nature of the art market, creates opportunities for criminal activity, the possibility being more enticing for dealers who come into contact with millions of dollars. Art Dealers are trusted mechanisms in the art market, but what happens when dealers take advantage of their trusted position in dealing with very expensive purchases? When caught, the result is massive criminal, civil, financial, and reputational damage.

Inigo Phillbrick - $86 Million Wire Fraud

Inigo Phillbrick orchestrated one of the largest recorded art frauds to hit the art market. Born into the art world, he attended art school and became an intern for the London White Cube Gallery in 2010. In 2013, Phillbrick opened his own gallery. He entered the art market with a splash, spending a little under $5 million at his first international night auction. The ability to go into the millions cemented Phillbrick as a new player in the global art market. He continued to build his career, opening an ancillary gallery in Miami. Phillbrick documented his rise through his frequent use of social media.

Underneath the glitz and glamor, Phillbrick had built a massive Ponzi scheme fraud. As described in the criminal complaint, he used fractional ownership investments and fraudulent loans, often with forged signatures, to pay off older clients, entice new investors, and finance his own lifestyle. He would also refuse to return artworks to owners, depriving them of their property and monetary value. Phillbrick scammed at least twenty-three victims. The scheme fell

Credit: Instagram | Phillbrick being arrested in Vanuatu

apart in 2019, with Phillbrick ultimately fleeing to Vanuatu, a remote Pacific island. The F.B.I. obtained a warrant for Philbrick’s arrest, and he was arrested by U.S. Marshalls in 2020.

As a result of his scheme, Phillbrick was charged with violation of 18 U.S.C. § 1343, fraud by wire, radio, or television. In November of 2021, Phillbrick entered a guilty plea to the charges. Due to the scheme's scale, Phillbrick's apparent lack of remorse, and as a deterrent to other art world fraudsters, the government recommended the sentencing to be a full restitution of the $86,672,790 million and a lengthy jail time. Phillbrick was sentenced to seven years in prison, forfeiture of two paintings, and refunding all the money obtained through the fraud.

Daniel Elie Bouaziz – Counterfeit Art and Money Laundering

Daniel Elie Bouaziz attempted to pass off hundreds of print copies of high end art as original works worth millions. A French and Israeli citizen born in Algeria, Bouaziz came to the United States on a B-2 visitor visa. He established two physical galleries in Palm Beach, Florida as well as three companies, all of which he used to distribute cheap prints which he purported to be legitimate. Employing tactics such as falsifying the works’ provenance and adding artists’ signatures to the prints, Bouaziz would then launder the proceeds from sales across multiple bank accounts. The profits from his fraudulent deals supported a Miami lifestyle of luxury cars, lunch events, and art events that made him well known in the community.

The fakes he distributed covered a wide range of widely recognized artists, with names such as Basquait, Warhol, Banksy, Monet, and Rodin. He once offered a customer the “holy grail” of original pieces by Roy Lichtenstein, Keith Haring, and Henri Matisse for only $290,000 paid via credit card. However, when the purchaser brought their newly acquired works to a New York gallery for authentication, inconsistencies were discovered in the sizes and edition numbers. Even more alarming was the fact that eBay had an exact match to the Lichtenstein listed for only $535.50. Authorities were alerted to Bouaziz in 2021 when several patrons who had purchased works through him were suspicious of misconduct, with some demanding refunds to no avail.

The sixty-nine-year-old art dealer was formally charged in June 2023 after warrants were issued to search his two Palm Beach, Florida art galleries as well as his financial records. While sixteen counts were originally filed against Bouaziz, he pleaded guilty to money laundering and violating 18 U.S.C. § 1956 when he “knew some of the pieces he sold were not genuine.” He has been sentenced to twenty-seven months in prison, with three subsequent years of supervised probation, as well as a $15,000 fine. It is likely that he will be deported at the completion of his sentence. The sentence is relatively lenient, especially in light of Inigo Phillbrick’s sentence, because Bouaziz expressed remorse for the harm he had caused and stated he wished to reimburse the art patrons affected by his actions.

Wendy Halstead Beard - Fraud

Wendy Halstead Beard was a photography art dealer in Michigan who pleaded guilty to wire fraud and defrauding $1.5 million from customers. Her scheme was centered around selling works on consignment, meaning that the original owner would still get a percentage of the profits in a sale as outlined in the consignment agreement. Beard would hide consignment information to keep all the sales profit for herself while hiding the status of the pieces from the original, often elderly, art owners.

Beard would also lie about the ability to sell a piece, saying there was no interest, and would then sell it herself without notifying the original owner. The most expensive work Beard did this with was “The Tetons and the Snake River, Grand Teton National Park, Wyoming,” by Ansel Adams, which she sold for $440,000 while hiding the sale from the original owner.

To hide her scheme, Beard told elaborate lies to customers. For example, she would create fake assistant email accounts. She would use the accounts to tell customers that Beard was suffering from severe health issues, such as needing double lung transplant surgery, as a reason why there was not an update on a sale status.

The scheme was exposed in 2022 when owners complained that their consigned works were not being returned. An F.B.I. investigation began, uncovering the full extent of the fraud. A criminal complaint was filed against Beard in October 2022. Beard pleaded guilty in July 2023 to wire fraud in violation of 18 U.S.C. § 1343. Beard’s sentencing is set for December 2023.

Credit: Southeby's


Due to the high price of art, the trusted position of art dealers, and the secrecy in the art market, bad actors can take advantage of their clients and create fraudulent schemes. A positive is that there is legal recourse for those who are defrauded. And the size of the frauds, mirroring the money involved, often catches the attention of authorities such as the F.B.I. The consequences for the fraudulent dealers are high, in the legal sense, with jail time, restitution, and even deportation, and in the reputational sense, as no one will likely want to work with an exposed fraud. So, while the impact of fraudulent dealers can be severe, there are legal remedies, and the scamming ultimately hurts the dealer most in the long term as their future career opportunities are destroyed.

*The views expressed in this article do not represent the views of Santa Clara University.


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