The Art of the Con: The Most Notorious Fakes, Frauds, and Forgeries in the Art World

by Anthony M. Amore

  Shortly after the transaction was made, Takeuchi turned to two experts to examine his prized Rembrandt for the sake of appraising its value. The pair inspected The Apostle James and came to a clear conclusion: the painting was not what it was promised to be. Takeuchi contacted Sakhai to inform him of the news, but the con man remained steadfast: the experts were mistaken, he told his client. As he had done in 1992, Takeuchi wrote to Sakhai accusing him of selling a “forged Rembrandt piece” to him, threatening to contact the authorities and to file a lawsuit against the dealer. “As it was exactly like before,” Takeuchi wrote, “I was tricked again by your performance. . . . Prof. Tanaka has looked closely to examine the painting, and he concluded this painting is totally different from the one . . . Citibank certified.” Takeuchi added that he had “gotten the report of examination by IR [infrared] and X-ray from the world famous restoration authority, Prof. Kuroe. The result . . . also conflicts from what you said.”22

  Perhaps banking on the possibility that Takeuchi was bluffing and would not want to suffer the stigma of being played for a fool, Sakhai did not back down. Instead, he continued to deny that the painting was a fake. As Takeuchi would later describe, Sakhai “remained unruffled.”23 Remarkably, Sakhai played his dupe perfectly. Swayed by Sakhai’s stubborn denial of both Takeuchi’s accusations and the experts’ findings, and the fact that other well-known Japanese buyers had done business with the dealer, he backed down and held on to the Rembrandt. Takeuchi was also buttressed by the fact that Tanaka told him the painting was nonetheless worth about $4.75 million—a curiously high figure for a copy. After all, in 1997, Tanaka wrote to Sakhai, stating that the painting he had sold to Takeuchi was not the authentic The Apostle James and that “the differences between the two” were “easily” detected.24 So despite being exposed by experts and confronted by a powerful buyer, Sakhai was able to walk away from his sale of a copy unscathed. Tanaka’s unusually high valuation of the painting, perhaps a gesture intended to save his client any further embarrassment, also spared Sakhai an earlier comeuppance. But he was far from done, duping an untold number of buyers in Asia and elsewhere. Federal prosecutor Jane Levine would later write that “Sakhai interjected hundreds of forgeries into the international art market.”25

  Call it karma or serendipity, but Sakhai would be undone by circumstances as simple as his scheme was complex. Not content to simply make enormous profits on the fakes he sold to unsuspecting buyers, Sakhai’s greed led him to sell the original authentic works too. When a few years had passed after he sold his fraudulent works, Sakhai would move to sell the real painting. Because he had used the original certificate of authenticity to sell the copies, he would need to have a new certificate issued. Armed with the real painting and clear title and provenance to support him, obtaining authenticating documents was relatively easy.

  One of the originals he decided to sell was Paul Gauguin’s Vase de Fleurs (Lilas). In order to do so he approached Sotheby’s in New York, which promptly listed the painting in their catalog for their spring auction in May 2000. Sotheby’s main competitor, Christie’s, also had a Gauguin for sale in their spring auction catalog: an identical Vase de Fleurs (Lilas). It wasn’t long before the two auction houses communicated with each other and agreed to submit the paintings to an expert to determine whose was the fake. For authentication they turned to Sylvie Crussard of the Wildenstein Institute in Paris.

  Crussard is the coauthor of Gauguin: A Savage in the Making: Catalogue Raisonne of the Paintings (1873–1888) and one of the world’s leading experts on the works of the great French Post-Impressionist. The painting created by Sakhai’s Chinese copyist was considered by the expert to be “so similar in the detail of brush strokes that one would not notice any differences from photographs if one did not suspect the existence of two versions,” and said it would be “impossible to tell which version should be catalogued” from photographs.26 However, Crussard knew that Gauguin would never have copied one of his paintings without making changes, and when the two actual works were put side by side, “all doubts were quickly removed.” Crussard examined not only the brush strokes, but the sides and reverses of the paintings and easily found that despite Sakhai’s best attempts to artificially age the copy, they were vastly different. “One looked old and the other new,” she said. “And no one hesitated” in identifying the authentic painting from the fake.27 The Christie’s version was pulled from its catalog and Sotheby’s sold Sakhai’s original at auction. Unlike the better-known works by Gauguin, which can sell for tens of millions of dollars, Vase de Fleurs brought Sakhai more than $300,000.

  FBI agent James Wynne worked to find the provenance of the fake, which had been sold to a Japanese collector before making its way to Gallery Muse in Tokyo.28 Based on his decades-long experience in investigating art crimes, he was able to determine that the ownership of both the fake and the authentic paintings intersected at one person: Ely Sakhai. Later, more such cases would become known to the bureau. One buyer who purchased a work by the Swiss painter Paul Klee later found that the identical painting was being offered by Sotheby’s. Alarmed, the collector alerted investigators, who tracked those paintings back to Sakhai as well. Soon, thanks to the dogged efforts of Agent Wynne, feds were able to track a dozen such incidents involving Sakhai, beginning 14 years earlier when he bought Marc Chagall’s La Nappe Mauve at Christie’s in London for about $300,000. He fraudulently sold a copy of the painting three years later for nearly a half-million dollars; five years after that, he sold the authentic work for over $30,000 more than he paid for it.29

  Wynne’s work on the case was nothing short of painstaking. In addition to the intense provenance research he completed, he also set about doing stakeouts of Sakhai’s establishment to find who was painting the copies. Said prosecutor Jane Levine, “Jim Wynne was able to identify, locate, and speak to many of the artists that had actually created the forgeries.”30 Once he had interrogated the Chinese artists, Wynne was able to convince them to provide evidence of Sakhai’s scheme. The artists gave Wynne photographs documenting the copies they had made. Said Wynne, “To me this was the most significant event in the history of the case, because we now had Mr. Sakhai commissioning, ordering, orchestrating the entire scheme.”31

  On March 9, 2004, Ely Sakhai was arrested in his gallery in New York on federal mail and wire fraud charges by James Wynne and a number of his fellow FBI agents. Three months later, a Southern District of New York grand jury indicted Sakhai on those charges as well as the related conspiracy. A September 2004 statement to stockholders of another of Sakhai’s business ventures, Australian-Canadian Oil Royalties, declared that Sakhai had been indicted but that he, as the company’s president and director, “vigorously” denied the charges.32 That vigorous denial didn’t last long. As happens with so many art fraud con men, Sakhai realized the government’s case against him was rock solid and pleaded guilty on November 29, 2004, to the conspiracy and mail fraud charges. He also agreed to an enormous restitution agreement that would require him to repay $12.5 million to his victims in addition to the forfeiture of 11 paintings.

  At his sentencing, Judge Loretta A. Preska sentenced Sakhai to 41 months in a federal penitentiary. Yoichi Takeuchi attempted to sue Sakhai in a New York federal court for damages related to the sale of the phony Rembrandt painting, but he was unsuccessful due to the statute of limitations on his case. He is not alone in his loss. As Sakhai’s prosecutor Jane Levine has written, despite a six-year intensive investigation into Sakhai’s wide-ranging fraud, “we do not know and may never know the full scope of the crime and the damage caused.” She added that the damage done by Sakhai “will reverberate in the art world for many years to come,” because Sakhai’s copyists made hundreds of copies for him that are still out there in the hands of unsuspecting dupes, all wanting to believe they have the real thing.33

  Eight

  The Bait and Switch

  The late publisher
Malcolm Forbes was one of the great collectors in American history. His was an eclectic taste: he amassed toy soldiers, autographs, and, most famously, Fabergé eggs, for which he had a fascination that began in his youth. He also collected historic documents, purchasing the expense account that Paul Revere submitted after alerting the townspeople of the coming of the “Regulars,” as well as a note handwritten by Abraham Lincoln. While Forbes was also a collector of art and favored military depictions while eschewing abstract art, perhaps the art he loved most was the art of collecting. “If anyone should seek my advice about collecting,” he said, “I’d quickly point out the old truth—buy only what you like. Measure a work by the joy and satisfaction it will bring.”1

  After Forbes’s death, most of his collection was sold over time, and little today remains of what he so passionately collected. Even his treasured Fabergé eggs would eventually be auctioned off, along with his paintings. While his art collection was certainly valuable, it did not rival that of other families known for their wealth. “My interest is not that of an academic collector,” Forbes said. “I didn’t grow up exposed to old masters. My father didn’t found the Mellon museum.” Instead, his artistic tastes veered toward trompe l’oeil, or “trick the eye” works—artistry so meticulously detailed that it made the two-dimensional appear three-dimensional.2

  Forbes, then, would likely have appreciated the work of the Los Angeles–area artist Maria Apelo Cruz, a trompe l’oeil artist whose ability to create classic reproductions has garnered her elite clients from LA and Beverly Hills who are looking to restore intricate works of art on items ranging from antique furniture to large murals. Elements of Living magazine reported in 2005 that Cruz, classically trained as a painter, kept herself busy by copying the styles of long-dead painters. “I love to recreate what I find most beautiful. Luckily for me enough people have a need for my particular skill.”3

  One such person was Tatiana Khan, the owner of the Los Angeles art gallery Chateau Allegré. The then 65-year-old Khan had spent over four decades in the business of buying and selling art and approached the talented artist with a commission. She showed Cruz a photograph of a pastel drawing by Pablo Picasso and offered her $1,000 to make an exact replica of the work. The drawing was needed for a noble cause, explained Khan, whose appearance was that of a much older woman. A client of hers had owned the original, she said, until it was stolen from the client’s home along with some jewelry. In order to catch the thief, the police needed an exact copy to use as a prop, so Khan was willing to provide the artist the exact dimensions of the original. Understanding that she’d be helping the authorities to recover a work by a true master, Cruz accepted the job and went to work duplicating the work.4

  As a first step, Cruz took the photo Khan provided her to a copy store in Van Nuys and enlarged the image in the photo to the size prescribed by the art dealer (30.5 × 23 cm). Then, back in her Sherman Oaks studio, she merely traced the image in the photo onto paper and used pastels to add the appropriate color. The original work consisted of varying shades of blue with touches of yellow, gray, and rouge, and it took Cruz only two weeks to copy. When she was done, Cruz had a dilemma: as an ethical artist, her practice upon completion of a copy of such a work would be to sign it with her own name followed by “after” and the artist’s name, in this case “after Picasso.” But since it was her belief that the piece was to be used as a prop in a ruse conducted by the police, she contacted Khan and sought her guidance. Cruz was told to sign Picasso’s name only, and she did as she was instructed.

  There was no reason that Cruz should not trust Khan. The two had a preexisting positive relationship, and Khan had her admirers in the community. A professional associate spoke of her practice of putting concern for her clients over any desire for a “quick sale.” Members of her family spoke of her big-hearted nature, calling her “the family angel” who provided an unemployed sister living out of state with large sums of money for her cancer treatment. Even former Nevada attorney general George Chanos attested to her character, describing Khan’s actions as a businesswoman as “evidencing a caring and compassionate soul, someone who cared more about doing the right thing than making a sale.”5

  Perhaps it was this reputation that led buyers to Tatiana Khan. One buyer from Beverly Hills had been purchasing “collectibles and other decorative items” from Khan for years. Most of these items were those that Khan told the buyer she was selling from Malcolm Forbes’s collection. This was nothing new, according to Khan, who said that most of the items she had for sale were obtained from a London dealer involved in moving Forbes’s collection. Another customer bought four items from Khan for about $4,000, all of which were let go at a great deal in order to clear space in Chateau Allegré for the entire Forbes collection, which Khan said she had purchased. Clearly, Khan’s connection to the collectibles from Malcolm Forbes’s estate was a key selling point for her business.

  It was this sort of cachet that led Jack K. to bring his business associate, Vic S., to Khan’s gallery on La Cienega Boulevard in Los Angeles in July 2006.6 Vic, who had been making investments with Jack for around a decade, was in the market for Impressionist paintings, and since some of his investments with Jack had included art purchases through Chateau Allegré, he met with Khan in person to discuss the sort of items he was seeking. Khan told the investors she might be able to accommodate their needs since she was in possession of artwork from the Forbes estates for sale. Because of a conflict within their family, Khan explained, the Forbeses were desirous of handling the sale of their works privately. As a result, the works from the Forbes Collection were available below market value. As proof of her connection to the Forbes family, Khan opened a book in her shop and showed Vic the signature of Malcolm Forbes inside. It was a strong sales pitch by an experienced dealer.

  Aware that there was money to be made selling Impressionist works to the pair, Khan began to seek some high-value pieces and contacted Frederick Hudson of Frederick Hudson Fine Art in New York City. Hudson is a reputable art broker capable of connecting buyers and sellers of art, and Khan was seeking to be connected to people looking to sell Impressionist works that she could then sell to Jack and Vic. Hudson went to work reaching out to his contacts to get photos of art that met the needs of the two investors. He sent what he had to Khan.

  Included in the pile of photos that Hudson delivered to Khan was a painting by the esteemed Jewish Modernist Marc Chagall titled Le Bouquet Sur le Toit, an untitled work by the Dutch American master Willem de Kooning, and a drawing by Picasso called La Femme au Chapeau Bleu (The Woman in the Blue Hat). Of the three, Hudson was only able to provide certificates of authenticity for the Chagall and de Kooning. She took special notice of these as good prospects for her client-investors, and asked Hudson to seek the certificate of authenticity for the Picasso.

  The asking price from the private European owner of La Femme au Chapeau Bleu was $1.35 million, but the absence of provenance was a sticking point for Khan. Hudson contacted his counterpart who represented the Picasso’s owner but was unable to obtain an authenticating document. Though Khan said she had a buyer lined up for the Picasso, she and Hudson spoke no further about the drawing. Khan came up with a solution of her own: she visited her trompe l’oeil artist, Maria Apelo Cruz, with her story about the theft and the need for the pastel drawing for a police operation.

  Weeks later, Khan called Hudson with “something to tell him that he wouldn’t believe.”7 Incredibly, she said that during a visit to a client’s home she saw the exact Picasso pastel about which she had previously inquired, and she intended to get it to show to him. Soon thereafter, Khan again called Hudson, this time inviting him to come to Chateau Allegré to see the Picasso. When he arrived, he saw that Khan had not only miraculously acquired the pastel, but she also was able to get the provenance she needed. She explained that on a trip to Palm Springs she was able to obtain La Femme au Chapeau Bleu, along with its certificate of au
thenticity, which the former owner had kept in her safe deposit box after inheriting an art collection from her father. In addition, Khan told Hudson that she obtained the work in a trade, giving the Palm Springs woman a large-scale European sculpture that had been in her garden.

  Something about the pastel apparently didn’t seem exactly right to Hudson. The experienced art broker, unaware of Khan’s scheme, advised her to contact Sotheby’s to discuss the Picasso because of the similarity between the work she had and the one that the auction house had previously sold for $900,000. Thinking that this could not be one and the same as the image he had sent her in a photograph, Hudson posited to Khan that perhaps Picasso made two versions of the work. If this was the case, her work could draw attention in the art world—and that attention could conceivably increase its value. Curiously, Khan was not only uninterested in pursuing such information, she told Hudson “not to say anything about it and to leave the matter alone.”

  While Khan’s Picasso only raised questions in the mind of Frederick Hudson, Jack and Vic were impressed with the pastel, which they believed had been created by the storied artist in 1902. They entered into an agreement to purchase it from Khan in 2006 for $2 million. Just a few days later, Khan provided the investors with an appraisal listing the value of La Femme au Chapeau Bleu at $5 million. Vic saw an opportunity to profit from investments in art through Khan’s access to the Forbes Collection, and he set out to form a collective of investors with whom he could gather up valuable Forbes pieces at bargain prices. As part of this venture, Vic gave Khan deposits on the untitled de Kooning and a Renoir from Chateau Allegré, but those deals later fell through.

  In 2007, nearly eight months after buying the phony Picasso, Vic decided that it was time to sell it and realize some profit from his investment. He called Jack and informed him of his decision to sell the piece. Jack brought the pastel to Khan’s gallery, where it sat for 17 months unsold. From time to time, the art dealer would contact the owners to say that she had received offers on the purported Picasso, but these were merely creations of her imagination, devised in order to keep the investors at bay.