Art dealer or Art advisor?

Jun 20, 2023

One day cinema will explain it to you…

In an unregulated industry, art consulting is marred by legal disputes.

Welcome to a world where ignorance reigns and trust is rigged with millions of dollars. Too harsh? Read further.

It’s not cinema, but we’re close. To give an idea of the plots, we are between The Wolf of Wall Street, Ocean’s Eleven, and Pirate of the Caribbean.

Every day, and in my career dreams, I think I should have been an assistant director for Martin Scorsese. I could have told him incredible stories from the art world, I would have just asked for a percentage of the box office, together with something decent for my day job of research between Los Angeles and New York. I could have traveled around the art world like a spy listening and observing, not only the beauty of the freedom to create and think, the thrill of discovering new artists, but also and above all the misappropriations, still wondering if it is possible to find respect for the Artist and the Collector. Cynical? Read further!

Definitively, in a market economy, freedom does not belong to the artist but to those who know how to sell themselves well, professionals with a perfect image, with a portfolio of contacts (artists, heirs and clients) that make Hollywood and Wall Street blush. Even without understanding the whys and wherefores.

The information provided must be discreet and the transaction fast because in the world of finance “time is money”, even if this leads to losing control of the situation in the end.

The works of art, both ancient and contemporary, seem silent but capricious. Everything can change unexpectedly: their aesthetic appearance due to a conservation problem, their value due to the effect of fashion and the market, but also due to incorrect authentications because it was deemed that a scientific diagnostic campaign would waste too much time for those who want to invest …This is why « time is money » with works of art is a maxim to be reconsidered.

Instead, how many times have you read that art consultants have been involved in problems with their clients? And I would say that the general public only knows about 0.5%.

In 2015, one of the most famous German art-advisers, Helge Achenbach, ended up in jail after admitting to defrauding at least 18 million euros.

Among his very wealthy clients were the heir to the Aldi supermarket, Berthold Albrecht, and the pharmaceutical entrepreneur Christian Boehringer. Helge Achenbach admitted in court that he added extra markups to the cost of purchased artworks for his clients.

Another art-dealer, Angela Gulbenkian, pleaded guilty in a London court to defrauding a customer during the sale of a £1.1m sculpture by Yayoi Kusama.

But the latest news to date concerns one of the most important art consultants in the sector, Lisa Schiff, American, specialist in contemporary and modern art, founder and president of SFA Advisory (Schiff Fine Art). Her clients included companies, foundations and institutions, as well as Leonardo DiCaprio. Lisa Schiff is now the subject of two explosive lawsuits brought by former clients. The charges are of breach of contract, fraud and conspiracy, she is alleged in her role as a consultant to have embezzled millions of dollars from clients. Allegations by real estate heir Candace Barasch and attorney Richard Grossman allege Schiff owes them $1.8 million for a painting by artist Adrian Ghenie. Schiff had also brokered deals with multiple clients for works by artists such as Wangechi Mutu, Sarah Lucas and Chloe Wise.

She allegedly bought the work on their behalf, but she never declared and shared the entire profit when it was resold.

A scam that would seem common in the world of commerce, but the values at stake are much higher when it comes to works of art.
Harry Smith, chairman of London and New York consultancy Gurr Johns said:

«It is a real Far-West out there, due to the opacity of the art market, the customer may not know the true price of the work of art that he is invited to buy. The possibility of losing money is greater in the art world than in practically any other field, with the possible exception of horse racing ».

Many collectors hire consultants both to learn about all that is available – letting them travel the world to biennials, fairs and exhibitions since the client is often too busy to do so – and to access the most coveted works. A consultant also helps with care, storage, insurance and inventory, as well as prompting the client to focus on how to style the collection; may resell on behalf of the customer, although this naturally carries risks of conflict of interest.

The truth is that it is a profession without regulation and without real training because even with an impeccable university course, in a sector (especially on the art market) where the image of an untouchable and closed world is consolidated, only those who are already introduced or are good actors and manage to be present on the right evenings, and to move like a very delicate shark, manage to hunt the big fish. Etiquette is very present. Only contemporary art gives a slight opening… but without knowing the rules and without already being part of the game, it is very easy to get lost, or play the role of the small fish.

Few are chosen for their work, for their knowledge of the subject, for a true experience and above all for their respect for the artist (whose product and intellectual property, we recall, the transactions are about).

In the United States there is the Association of Professional Art Advisors, with a code of ethics and strict entry requirements. However it is a rare case, few countries have such an association, so it is up to the client to look for possible warning signs when looking for a consultant. The advice of the Association of Professional Art Advisors is

“Stay away from anyone promising big money, check the person’s reputation: a lot of so called advisers don’t last very long – they go off the rails.”

Unfortunately, recent stories seem to bear this out.

Champagne or Prosecco?
This lack of transparency is also found in the terminology used for professionals.

And so to conclude, let me clarify what is meant by some terms that are currently predominantly in English (because the world has decided that the English language is more comfortable and chic when talking about finance).

An art-dealer is an intermediary or rather a mediator who finds works of art on the market and who proposes transitions involving two parties (one who sells and the other who buys) with a percentage of the transition that is due to him or her for the intermediation work, as agreed between the parties.

Instead, the art-advisor advises collectors on how to manage their collection… (investment management, marketing, conservation and research, etc.).

(And maybe I’ve already lost you on the differences between buying advice and style advice!)

While in French we use a historical word to define this role of intermediary, which has almost disappeared due to the generic and globalized use of « art-dealer », the word « courtier ».

The activity of courtier has been recognized by the French Academy since 1694.

According to French law, the “courtier” is the professional who carries out the activity of intermediation. His job consists in acting as an intermediary for a transaction between a seller and a buyer, from whom he is always independent. The transaction may relate to any purchase or sale of goods or provision of services.

One of the first written documents of its use dates back to 1248: the Cartulary of Ponthieu evokes the “courratage” activities to which the guilds of craftsmen had to resort to protect themselves. It is from 1358 that the word also becomes “couratage”, “courtage”, the forms of the word declined in coul-coultage are often of Flemish origin. The history of law, commerce and navigation often refers to brokers of wine, oils, grain, horses, silks, etc.

The brokerage profession exists in many areas and many other countries, and is regulated differently, to protect the participants of the market in question, but the borderline is not well understood in art.

However, I will continue to use the old French word “courtier” and also “courtière” in the feminine. Not because I’m French, but because to work in art I prefer to use a diplomatic, coherent, historical word that evokes the poetry of the first exchanges and commercial negotiations made across seas and oceans…

Marine Butera