by Peter Watson
To take these collections at their own estimation of themselves, you would think that these are present-day marvels, jewels of collecting by people who care deeply about the past. Look through the catalogs for the exhibitions based on the collections and there are thousands of objects, worth millions of dollars. And yet, not one of these objects has a provenance and, we now know, they comprise mostly loot. These collections of statues, vases, and items of jewelry in fact tell us next to nothing about the past because the great majority of the objects have been ripped from their context by tombaroli, at times motivated (they say) by a misplaced “passion” for archaeology but always interested in money, and brought to market by Medici and his surrounding network, who, to judge from the markups they place on these objects, are even more interested in money, and exclusively so. It is these collectors whose funds and cavalier collecting habits, without thought for where these objects come from or how they were ripped from the ground, sustain the looting that does incomparable damage to the heritage of Italy and—without doubt—elsewhere.
10
THE LAUNDRIES OF LONDON AND NEW YORK
DECIPHERING THE PAPER TRAIL that has been the subject of the previous four chapters occupied Maurizio Pellegrini for many months. It was a fascinating and important piece of detection, but from Paolo Ferri’s point of view, it had one serious, indeed near-fatal flaw. The original documents they were dealing with were in Switzerland and the batch that Pellegrini had brought to Rome were photocopies. The information in the photocopies might be just as good as the information in the original documents, which were still sequestered in Geneva, but they were no good as evidence. Any court, anywhere, would insist on the documentation being original. The same argument applied to the objects themselves that were under seizure in Geneva. They were evidence, and if Ferri was to produce this evidence in court, in Rome, he had to get the vases and statues and bronzes themselves out of Switzerland and into Italy.
But, by early 2000, the Swiss still hadn’t made a move, nor had they indicated whether they were likely to be proceeding against Medici. Time was passing. Medici was claiming that his business activities were being unreasonably disrupted, and he tried time and again to have the warehouse and its contents de-sequestered. He insisted on his innocence and that the charges against him be dropped.
But then, in early 2000, two occurrences came together. In 1997, it had emerged that a number of Swiss banks held many accounts belonging to victims of the Holocaust that had remained dormant since World War II, accruing interest but not being used. Many people—Jewish and non-Jewish alike—were outraged by this and felt that these monies should be used to benefit Holocaust survivors. In 1998, a conference was held in Washington, D.C., and despite opposition from the Clinton administration, hundreds of state and local finance officials across the United States decided to implement sanctions against Swiss banks in their respective states, states that included California, New Jersey, New York, and Pennsylvania. Initially, the Swiss criticized the boycott and threatened to sue. The three main Swiss banks—Credit Suisse, Union Bank of Switzerland, and the Swiss Bank Corporation—all resisted any payout. Just over a month later, however, and a matter of days before the sanctions came into force, the Swiss banks backed down and agreed to start payments to Holocaust survivors. Between then and the summer of 2000, an overall figure for repayment was worked out: $1.25 billion. This was settled by a judge in July 2000, and at the beginning of August that year, the three big Swiss banks agreed.
This was all happening at the time Pellegrini was working on the paper trail and while Ferri was waiting for the Swiss to decide on whether to prosecute Medici. The Holocaust survivor issue would prove crucial.
The second event was that Pellegrini finally sorted out a pattern in the documents that had been troubling him. He had been worrying away at the documents and had begun this part of his investigation by trying to find out exactly what Medici had sold at Sotheby’s, and where these antiquities had ended up, after they passed through the London auction house. That was necessary if the objects were to be recovered. Ferri had officially asked Sotheby’s in London for help, and the salesroom had sent him some documentation, but it wasn’t complete—so they felt in Rome—and was consequently not as helpful as it might have been.1
So Pellegrini drew up a comprehensive list of what Medici had consigned to Sotheby’s. Next, where he could, he matched this to photographs found in the Geneva warehouse. Finally, he did what he could to match these two sets of records with what was actually sold at Sotheby’s. This exercise produced a confusing picture, at least to begin with. Some of Medici’s objects were sold, and when they were, Sotheby’s refused to say who had bought them. That was their commercial right, they said. But quite a few of Medici’s objects did not sell and were included in later auctions—where, again, some sold and some did not. Many objects were included in three or four auctions before they were finally sold.
But, and this is what was confusing to begin with, some of the objects seized in Geneva had Sotheby’s labels on them. These small white cards, tied to the objects with thin white thread, had written lot numbers on them and dates from the sales where they had been sold. So Medici was buying as well as selling at Sotheby’s. Ferri and Pellegrini asked themselves why he would do that when he made his money by acquiring illicitly dug vases and other antiquities from tombaroli in Italy, where the markups were so much greater than they ever could be with objects bought openly at auction, where anyone interested could look up the prices paid.
It was late one afternoon in November 1999 when Pellegrini finally saw the light. He was sitting at his desk in the small office he shared with Daniela Rizzo, chief investigative archaeologist, on the second floor of the administration building at the back of the Villa Giulia Museum, in Rome’s elegant Parioli district. It was drizzling and already dark, and the only light came from his Anglepoise lamp. He was looking at the Sotheby’s catalog for its auction of antiquities in December 1994, five years before. There are usually 400–600 lots in an average sale, and as he leafed through that particular volume, he had reached Lot 295, a Gnathian-style hydria. This object, he knew by then, had been sent for sale by Medici some two to three years before, and it had been in other sales but hadn’t found a buyer. That November afternoon, however, Pellegrini had a strange sensation: He had seen Lot 295 before, and very recently. But where? It could only have been among the objects seized in Geneva. The vases and statues themselves were of course still in Switzerland, but good-quality photographs had been taken of everything. So Pellegrini found himself back among the photos. And what he found was that Lot 295 featured in the photographs not once but twice. It was shown in the Polaroids, as dirty and fragmented, before restoration; and it was shown in the high-quality photographs taken by the Swiss expert—with a Sotheby’s label attached to it.
The penny dropped. Lot 295 had been sent to Sotheby’s for sale by Medici and, after one or two unsuccessful sales, it had been bought back. This explained the odd pattern that had been haunting them all—Paolo Ferri, Conforti’s men, and Pellegrini himself. It explained how Medici could have in his possession in Geneva many objects that, according to the records, he had sold.
Armed with this insight, Pellegrini now looked at Medici’s documentation under a new light. It didn’t take him long to find other examples. In the Dossier section, we give the complete and detailed list he prepared for the prosecution against Medici. In each case the pattern was the same. In the first instance, Pellegrini identified twenty-nine objects, in four sales between 1987 and 1994, in which Medici bought back objects he had sent for sale at Sotheby’s in London. There was, for example:• A black-figure Attic amphora, which was sent to Sotheby’s by Editions Services. It was taken into Sotheby’s under the account number 216521 and was Lot 283 in its antiquities sale held on December 14, 1987, when it sold for £17,000.
• A terra-cotta head was sent to Sotheby’s by Editions Service on September 13, 1989, number 50 in the cons
ignment note. It was taken in by Sotheby’s with the property number 1002611 and was Lot 100 in its antiquities sale held on December 11, 1989, when it sold for £2,200.
• Four Apulian terra-cotta vases were sent to Sotheby’s by Editions Services on 2 March 1990, numbers 51 and 57 on the consignment note. They were taken in by Sotheby’s with the property number 1012763, and were Lot 319 in its antiquities sale of December 8, 1994, when they sold for £1,100.
Each of these objects—twenty-nine in all—was received at Medici’s Geneva warehouse, where it was originally dirty, incomplete, and fragmented, as the seized Polaroids confirm. Later, these same objects, now restored, were sent to Sotheby’s for sale, and after sale they were returned to Medici’s warehouse, bearing Sotheby’s labels.
In other words, this was an extensive laundering operation, “extensive” because Ferri and Pellegrini had documents that related only to the 1987—1994 period, and Sotheby’s, though cooperative to an extent, did not cooperate fully. Even so, the documentation that Pellegrini did manage to trace showed that, in one sale, dated December 8, 1994, Medici bought back twenty-four objects, paying £34,250 for the privilege. Except that he didn’t have to pay all that since he was, for the most part, paying himself. What he actually had to pay was the commission on the sales, twice over—once as seller, and once as buyer. Assuming the commission was somewhere between 10 and 15 percent, both on buying and on selling, the December 8, 1994, sale would have cost Medici between £6,850 and £10,275. To this would have to be added the cost of shipping these goods to and from London, and costs for illustrations in the catalog, but the above sums are almost certainly exaggerations since Medici, as a valued and regular customer of Sotheby’s, would have been able to negotiate rates more favorable to himself. (Different documents show that, on other occasions, Medici paid Sotheby’s between 6 and 10 percent commission, which means that this particular transaction probably cost him between £4,110 and £6,850—hardly bankruptcy level.) But obviously, whatever the cost, the existence of the objects back in Geneva showed that Medici judged it worth his while.
Ferri asked Sotheby’s for its cooperation, which it offered, providing information only in regard to Editions Services, and concluding that, between 1985 and 1994, each of the few clients who bought large numbers of Editions Services goods “were established and well known dealers, who generally bought large numbers of items at Sotheby’s. We do not believe that there are any grounds for believing that any of them was buying on behalf of Editions Services. To have been laundering any significant number of works of art, Editions Services would have needed to use dozens of different agents and/or pseudonyms none of which were known to us. None of the information we have suggests that this was the case.”
Sotheby’s did, however, identify what it called “two areas of difficulty.” The first was a small number of instances (fewer than ten), all relating to pre-1986 sales, when Boursaud appeared to have been buying items he was selling. “This practice is (and was at the time) forbidden by Sotheby’s contracts and internal policy but can be difficult to spot, prove and/or prevent.” Second, Sotheby’s established that at the December 1994 auction, “a known and, so far as we are aware, legitimate Geneva based transportation company, Arts Franc, purchased 14 of the 34 items sold by Editions Services . . . we have now identified circumstantial evidence to indicate that this company may have been acting on behalf of Editions Services in making these purchases.”j Finally, Arts Franc had acted for Editions Services “in relation to the transportation of and payment for” certain items purchased by Editions Services in relation to an earlier sale, in London on July 7, 1994, and subsequently, in a Sotheby’s sale in New York on June 1, 1995.
Sotheby’s was adamant that it was not aware of these practices until after the Medici investigation was begun, and that it would not have permitted them had it known. The company did admit, though, that such practices were difficult to identify and to prevent. This seems to be confirmed by the fact that Sotheby’s own inquiry identified an “area of difficulty” with fourteen items in its sale of December 8, 1994, whereas Rizzo and Pellegrini found twenty-four items in that sale that had been bought back. In other words, not only Arts Franc was acting that day on Medici’s behalf—at least one other buyer or company was as well. To that extent, the laundering was a sophisticated conspiracy.
It seems then that some buying back, or laundering, did occur and is accepted by all sides. The list originally given above (and completed in the Dossier section) refers to five separate sales, which all took place at Sotheby’s in London. But Sotheby’s in London may not have been the only laundry for antiquities. Sotheby’s, in its report, mentioned a suspicious sale at its own New York branch.
During the raid on Phoenix Ancient Art, Jeffrey Suckow, the manager for Inanna Art Services, the company that owns the warehouses at the Freeport where the seized materials were being held, handed over photocopies of auction house catalogs relating to fourteen other sales between June 1995 and October 2000 in which objects seized from Medici had been sold and bought by the Aboutaams. These sales took place at Sotheby’s and Christie’s, both in London and New York, and at Bonhams in London. In at least two of these cases, the objects had started out with Medici, as proved by the Polaroids. They had then been “sold” at auction, bought by the Aboutaams, and ended up back with Medici. That confirms laundering in seven sales, and possibly as many as twenty-one, stretching from 1987 until 2000.
What was the purpose of these activities? Since they occurred on such a scale, it was obviously worth Medici’s time and trouble—but how, and in what way?
There are three possible answers, though one does not rule out the others. First, and most obviously, the fact that some of the antiquities on display in the outer room in Corridor 17 at the Freeport had Sotheby’s labels tied to them gave them a spurious provenance: The labels were visible “proof” that these objects had been bought on the open market and were therefore “safe,” or “clean,” and could be sold—even in Italy—because at this point they had an “official” provenance. The paper trail put together by Pellegrini in this case (paragraphs 1 to 20 in the relevant section of the Dossier) proves that such a presentation was totally misleading. But even without that, wasn’t Medici’s practice in itself curious, even suspicious? A moment’s reflection will show what we mean. A good proportion of the art, furniture, and jewelry on sale at dealers’ galleries around the world—in New York, Los Angeles, London, Paris, Milan, Munich, Zurich, Hong Kong, Sydney, Rio de Janeiro—has been bought at auction, but the dealers never advertise that fact, for the simple reason that, were they to do so, enterprising prospective customers or collectors would simply look up the records of the sale at which the painting or necklace or vase had been auctioned and find out what the dealer had paid for it. This would give them an inside track in any negotiations when it came to a potential sale. Therefore, Medici’s behavior, in advertising that a good number of his objects for sale had passed through Sotheby’s—even to the extent of showing the lot number—was a giveaway, evidence of a kind that what he was offering for sale in Geneva was, in fact, the very opposite of what he was pretending. The objects were not “clean”—far from it: A minority was stolen, the rest looted.
A second reason for the Sotheby’s rigmarole was revealed by Medici’s selling pattern. That is, he would submit things for sale and buy some of them straight back, but with others he would leave them at the auction houses, to see how well they sold—or didn’t sell. Those that didn’t sell immediately were reentered in subsequent auctions; in some cases, he bought them back after repeated failures. This suggests that he was using the auction houses to rig prices. When he consigned material to Sotheby’s, he naturally had some idea of what he wanted them to fetch. The consignment notes invariably had reserve prices attached, the minimum sum a consignor will allow an object to be sold for. If they fetched that price, all was well and good and he would let them go. However, if they didn’t sell at the price h
e wanted, and if they didn’t sell after being offered at auction several times, that could only mean either that they were on the market at too high a figure or that for some other reason the demand for that type of item simply wasn’t there. In either case, buying back a certain proportion of his own objects helped resolve the problem. To the uninformed observer, the vases or statues had “sold” at the target price, “confirming” their value. If enough of a certain type of object “sold” in this way, that must mean there was a healthy taste for it and other collectors would take note.
There was a third way in which Medici would have benefited from his “buyback” operation in the salesrooms. In fact, the whole antiquities trade would have benefited, in an indirect way. An argument often heard from those who oppose any stringent restrictions on the trade in unprovenanced antiquities is that when you look at the auctions, much of the unprovenanced material that passes through the salesrooms is neither very rare nor very important. Therefore, this argument runs, the whole problem is much less grave than the archaeologists say it is. As far as Medici’s deception is concerned, one aspect of his behavior was to “salt” the salesrooms with less-important material. In the list above, and in the Dossier section, the highest price that any “laundered” object sold for was £17,000 ($30,600) and the average sum was £2,105 ($3,790), considerably below the average price of the antiquities the Fleischmans sold to the Getty, which was more than $100,000. In salting the salesrooms with less expensive items, Medici accomplished two important objectives. By buying back—and therefore propping up the price of—basic objects (ordinary vases, routine marble heads, not uncommon capitals), he maintained the gold standard in antiquities. Provided that ordinary, garden-variety objects have a certain minimum price level and can be seen to have that price level, everything else above them will be multiples of that basic value. At the same time, by ensuring that the auctions were salted with “ordinary” material, he could help maintain the fiction that the antiquities market is primarily made up of such items.