When money is involved, not everybody is honest. That's true in every industry, and the art world is no exception. Art markets are plagued by everything from outright theft of valuable pieces to the selling of unauthorized reproductions. Although some experts claim that fraud isn’t nearly as rampant as the media would have the public believe, purchasers of fine art have to be more careful now than in the past.
Does Art Have a Title?
Of course, this is not a reference to an artwork’s name – like the Mona Lisa or Picasso’s Guernica. Think instead of what happens when you purchase a car. You receive a title that includes identifying information about the vehicle as well as information about you, proving that you own it.
But is an art purchase the same? Not exactly, as some pieces have a title, but many don’t. A title helps to prove that a painting, sculpture or other artwork was obtained legally from its former owner. Unlike the title for a car, however, there is no standardized title document for works of art or antiquities.
This is not a trivial matter. The Honolulu Museum of Art is suing a San Francisco art collector for $890,000 over a titling dispute. The museum claims that it purchased five pieces of Southeast Asian art, but to date the collector has not supplied the museum with a valid title or export/import documentation. In April 2015, the museum handed over the pieces to U.S. Immigration and Customs Enforcement after learning that the artifacts were likely looted from India.
In 2014, the same thing happened to the Toledo Museum of Art. In a process known as deaccession, museums around the world are now taking steps to separate themselves from works they own that they can’t verify as authentic and for which they don’t have clear title.
“If you have serious concerns about an artwork’s title, you can request searches of databases of lost and stolen art,” says fine art appraiser Evan D. Williams. “A single search may take several days and cost $100 or more, so this is not something that I would do as a routine matter, without a strong suspicion. And, of course, these databases are far from comprehensive. Most of the lost and stolen art in the world is not documented.”
The Provenance of a Piece
Depending on the type of art and its origins, a piece may come with provenance – the history of ownership – or some type of certificate of authenticity. Ideally, the buyer, or the art’s authenticator, should be able to trace ownership of the piece to verify its authenticity.
“Traditionally, you check the provenance before purchasing an artwork by asking the seller to provide documentation,” says Albi Schottenstein, owner of the Canvassed Gallery in Los Angeles. “With the advent of the Internet, where the buying and selling of artwork has grown exponentially, it has become increasingly easy to locate a stolen artwork.”
Not only does a strong provenance help to authenticate a piece, it may increase its value. But good provenance doesn’t necessarily equate to authentication or title. That is one piece of evidence an expert would use to verify that a work of art is eligible for sale.
“The vast majority of the world’s art doesn’t come with an unbroken paper trail,” Williams says. “This is especially true for pieces of significant age that may have changed hands several times, but it can also be true of recent work. Artists aren’t always the best accountants. Oftentimes, the paperwork that accompanies art is the most suspect thing in the whole deal. Anyone can print off an official-looking certificate, and it means nothing if the dealer is simply declaring the piece to be legitimate by fiat, without any supporting information.”
Do Your Due Diligence
Anyone planning to purchase a piece of art should go through a due diligence process. Due diligence, according to the law, is doing everything that you reasonably can to assure that you’re not purchasing a stolen piece of art. But even if you conduct strong due diligence, you could lose the piece – just as some museums and big-name art collectors have.
It’s not just that a piece of art may have been stolen. There could be a lien on it because of an unpaid debt from a previous owner, or the art could have been sold unlawfully as part of an ongoing divorce. Because of instability in the Middle East and other global hotspots, a piece could have been looted and sold multiple times without the knowledge of the current seller.
“In this complex and uncertain realm,” Williams says, “the best thing to do is to educate yourself as much as possible. Develop relationships with dealers and auction houses that have demonstrable experience in the material as well as long-earned reputations to protect. No one is infallible, but there are those in the art world who delight in the more scholarly aspects of the trade, not just the money or prestige; these are the kinds of people that collectors should befriend.”
The Bottom Line
Buying with absolute confidence is difficult in the art world – unless you can personally talk to the artist. And the older the piece, the more difficult it may be to verify its authenticity. The best course of action is to only purchase works with verifiable paperwork, but that won’t be possible in a lot of situations.