BEWARE OF PREDATORY DEALERS
http://www.cnn.com/2009/CRIME/07/14/art.dealer.indicted/index.html
The case is seemingly inconceivable. You have entrusted your artwork, which might as well be a member of your family, to the care of a gallery you trust only to discover that the dealer you are working with is up to no good. The recent indictment of prominent New York dealer Lawrence Salander has thrust predatory dealers into the spotlight and highlighted an unseemly side of the art world that no one really wishes to speak of and fewer wish to believe they could be a victim of… that of civil theft, grand theft and grand larceny by a respected gallery.
New York’s Upper East Side Gallery Salander-OReilly, provided Lawrence Salander, his wife Julie and his family a lavish lifestyle full of the finest cars, luxury homes, food, clothing and an extravagant lifestyle by selling high-end fine art to a distinguished world-wide clientele. A member of the Art Dealers Association of America for over twenty years, Salander-OReilly exhibited at the annual Armory show in New York, Tefaf at Maastricht and Art Basel Miami. Lawrence Salander himself was a member of The Art and Antique Dealers League of America and the Appraisers Association of America. He was the first private art dealer to sit on the board of The National Indemnity Project of The National Endowment for the Humanities. In 2003, Salander-OReilly was named The Best Gallery in the World by the Robb Report.
However, beneath the surface, it is alleged that Salander ran a ponzi scheme (a scheme echoing that of the indicted financier Bernard Madoff) in which he sold consigned works, took the cash, and paid deffered payments out to other consignors offering a range of explanations for his actions along the way. His payments snowballed into owing dozens of consignors monthly “dividends” which he would attempt to keep in front of with month-to-month sales. This “dividend” system financed Salander’s extravagant lifestyle, including his Manhattan townhouse, his 66-acre estate home and the lavish parties he threw for his wife and family members, all while he was barely keeping himself afloat in these “dividends”. His investors, including Forbes members, Artists, estates, tennis great John McEnroe and actor Robert DiNiro claim he stole in excess of $88Million through his fraudulent business practices, which included outright theft of artwork, selling “shares” of artworks to multiple people, selling artwork below the promised consignment prices and paying “dividends” to consignors when artwork was already paid in full.
Mr. Salander’s troubles began when several consignors filed lawsuits due to defaulting on the “dividend” payments he promised by specific deadlines. Salander allegedly sold many works by Robert DiNiro Sr. (Father of the actor) without either informing Mr. DiNiro or remitting proceeds for their sale. This was the crux of several of the suits brought against Mr. Salander which amounted to 100 separate counts spanning fraud, grand larceny, securities fraud, forgery, breach of contract and other offenses. The affair become public when London dealer Clovis Whitfield withdrew paintings from a Salander-O’Reilly exhibit because of Salander’s mounting legal troubles. Creditors are said to be owed in excess of $300M and Mr. Salander faces up to 25 years in prison if convicted of grand larceny alone.
This leads to the inevitable question… What can you do to protect yourself?
Well, there are several consumer protections in place which protect buyers and sellers/consignors in the United States. Many states will have laws specific to their borders, but for purposes of this blog, we will utilize Florida statutes and criteria. A useful text is The Artist-Gallery Partnership, by Tad Crawford and Susan Mellon (http://www.amazon.com/Artist-Gallery-Partnership-Third-Practical-Consigning/dp/1581156456/ref=sr_1_1/181-0314806-2703807?ie=UTF8&s=books&qid=1247710903&sr=1-1)
As a seller, artist or consignor: When you consign your artwork to a gallery you have entrusted an asset to another person or company. Just as with other assets, this has certain risks and certain rewards. The reward is obviously that your work is placed with someone who has knowledge and expertise on how best to market and sell your work in the shortest possible time-frame for the most amount of money. Conversely, you run the risk of a predatory gallery selling your work for less than value, not remitting payment according to terms of contract or outright theft.
It is good practice to familiarize yourself with any gallery you are considering consigning works to. Speak with other merchants in and around the gallery you are considering. Contact references, consignors and artists the gallery deals with for impressions on the overall demeanor and temperament toward business practices. Contact the Better Business Bureau (www.bbb.org) or the Florida Department of Agriculture and Consumer Services (www.doacs.state.fl.us/) to determine if any consumer actions have been filed and remain unresolved. Scrutinize your contract and have it reviewed by an attorney.
Once your work is contracted, consigned and in gallery residence, always be certain that your consignment contract is up-to-date with the entity which has physical possession of the artwork if it is not retained by the seller. (Oftentimes, galleries or partnerships are dissolved resulting in contracts being annulled. Among other issues, this may significantly affect insurance coverage in the gallery in the event of something catastrophic occurring to your item). Once a quarter, conduct a physical inspection of your item to make certain it has not been sold without your knowledge. If you are unable to inspect due to distance or infirmity, contact someone you trust locally or the local Sheriff’s office so that they might inspect your item for you. Make certain that offers lower than the contracted price are submitted to you in writing and agreed to in writing and do not agree to deferred payment plans without written assurance that the works will remain in the gallery until you are paid in full for your item. Sometimes even good galleries have difficult time paying the bills in this economic climate. However, you need to do everything possible to prevent your asset from paying only their bills.
Florida statutes state that your consignment contract must provide for:
*The proceeds of the sale must be delivered to the artist (Consignor) at a schedule agreed to by the artist (Consignor) and the art dealer
*The art dealer is responsible for the stated value of the artwork in the event of loss or damage while the artwork is in possession of the art dealer. (See parameters of consignors and galleries under UCC= Uniform Commercial Code Statutes)
*The artwork will only be sold by the art dealer for an amount at least equal to that agreed to by the artist (Consignor) in writing
*The artwork may be used or displayed by the art dealer only with prior written consent of the artist (Consignor) and only if the artist (Consignor) is acknowledged in such use or display
*An artwork delivered to an art dealer for the purpose of sale or exhibition, and the artist’s (Consignor’s) share of the proceeds of any sale by the art dealer, creates a priority in favor of the artist (Consignor) over any claims, liens or security interests in the artwork by creditors of the art dealer
(SOURCE: The Artist-Gallery Partnership, by Tad Crawford) Violations of these rules of conduct are punishable by up to 60 days in jail, six months of probation and a $500 fine for each instance.
As a Buyer: Your purchase order is a contract. Make certain that this contract provides you the basic parameters of what, where, how and when. Your purchase order should state the date, the value of the work, the price paid, numbering (if applicable) and the payment terms which have been satisfied at the time of sale. Further, as a buyer you are entitled to any peripheral documentation which quantifies authenticity (i.e. a Certificate of Authenticity, letters of authenticity, appraisals, etc.), condition, value, restoration, international clearance and the like which may exist pertinent to your acquisition.
Oftentimes, the bill of sale or purchase order serves as the certification of an authentic work if the artist is living, the gallery is contracted to work with the artist or the artist has chosen not to issue such certificates In such cases, you may wish to contact the artist or a local expert to determine whether or not the work is genuine. (It is not always in your interest to contact your local art dealer for this determination though as they may or may not have a vested or political interest in whether or not you purchase art from alternate sources).
The proliferation of serialized or limited edition works of art (lithographs, serigraphs, sculptures, documents and signatures) necessitates a need for some form of quantifying document which states the total edition size, the publisher and dates of issue. This certificate has become paramount in determining authorized items from unauthorized items, real from fake and delineations within an artist or celebrity’s oeuvre. While parameters of certificates of authenticity are a lengthy column unto itself, understand that certifications should be arms-length, third party evaluations of the item issued by a publisher, printer, foundry or independent expert on the artist. Galleries should not issue their own authenticity certificates for works published by others, as it is an obvious conflict of interest. Further, your legal ownership of a item is only consummated upon transfer of the original certificate of authenticity as this possession states that the work is paid in full to seller, gallery and other third-parties who may have interest in the work. So always make certain it is obtained, it is correct and it is safely stored.
If you have purchased a limited edition and not received the original certificate with your purchase, it may simply be a matter of contacting the gallery and asking for it. Oftentimes, galleries will keep certifications in separate places in order to protect themselves from theft, fire, flood, etc. However, this document should be readily accessible to the gallery and turned over within a reasonable amount of time. If it is lost, stolen or damaged, galleries can ask for replacements from the publisher provided the work has been purchased and paid for by the gallery. Alternatively, you can also seek outside advise from an expert on the artist or period.
I also recommend artists and consignors consulting a fine art attorney familiar with idiosyncrasies in Art Law pertaining to the state you live in or are releasing your items to. Legal Art is an organization which empowers artists and consignors by offering affordable legal council before, during and after a representation contract or consignment agreement. Their services are highly recommended by professionals in the field as having ethically and judiciously applied their knowledge to the betterment of the Art community as a whole. Kathleen C. Carignan, Esq. is a Miami-based attorney with Legal Art who may provide direction as to who to speak with about any questions particular to your case. (Kathleen@legalartmiami.org- www.legalartmiami.org) Other organizations throughout the United States provide similar services and can be located through a simple GOOGLE search of your area.
In sum total… There is no fool-proof way to avoid being “Salandered”, any more than there is to prevent the onset of “Madoffism”. However, simple steps you take to protect yourself, your assets and your capital can offer small comforts in knowing who, what, when and where of your art investments. This, in turn with pay true “dividends” as you move forward.
NOTICE: I am not an attorney, nor do I claim to be one. This blog is written in to provide common-sense advice for buyers and sellers of fine art, NOT Legal advice. For legal advice, contact an attorney.
Tags: Art Theft, Bernie Madoff, Boban Illic, Forbes, Fortune 500, Lawrence Salander, Museum, Ponzi Scheme, Salander O'Reilly, Salvador Dali, Scott Rothstein
While it’s an unfortunate tale, you were good enough to supply some useful tips on how artists might protect themselves, thanks for that. From an art collector’s point of view I don’t imagine this story instills much faith in the various professional associations that Salander was a member of.
Several thoughts came to mind while reading this blog, most prominent of them, is that this is a perfect example of why I prefer a wholesale relationship with a gallery over a consignment one. When I was a college student I had the misfortune of having a gallery close up shop while still having two of my works in its possession and it appears that this scenario happens with some frequency given how often I see it described on various art forums. The art world is the Wild West of commerce, very little regulation, which makes ethics not just a nice thing to have, but a requirement to any business dealings.
Reed, Love the blog and website! working on mine! Hope all is going well!
Thank you very much for that splendid article
Great reading sadly for our industry , great Blog!!! Thank you for the insight,
I‘m sure many of you are like me and one of the first things you do in the morning is head here and check out the new post. Along with seeing the new posts, I’m also always checking out the blog roll rss feed and watching them grow, or shrink sometimes. In one of my past …but all in all excellent site. Keep it up!
You already got some great responses…
http://www.artinfo.com/news/story/34124/salander-art-hoard-to-be-auctioned/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+artinfo-all+%28All+Content+|
UPDATE: Salander Art Hoard to Be Auctioned
Published: March 15, 2010
NEW YORK— Art dealer Lawrence B. Salander has yet to stand trial for his 103 counts of fraud, forgery, and other crimes related to business dealings at his bankrupt Salander-O’Reilly Galleries, but much of the work in the firm’s possession could be heading to auction as soon as June.
So far, more than 400 claimants have stated that they are owed money or art. Prosecutors believe that Salander failed to report the sale of some works of art as part of a massive fraud scheme that may have cost collectors and investors more than $90 million. Salander, free on $1 million bail, has denied wrongdoing and has filed for bankruptcy while awaiting trial.
According to documents that Robert Feinstein, a lawyer for the creditors, filed with U.S. Bankruptcy Court in September, the aggrieved parties have had talks with Christie’s about selling as many as 1,000 of the artworks in the possession of the gallery, some of them dating back to the 12th century. Until recently, any sale had been held up by First Republic bank, which is owed $30 million from a 2002 loan it made to Salander and as a secured creditor is entitled to the first cut of any proceeds. First Republic agreed to withdraw its objections to the sell-off after unsecured creditors threatened legal action, alleging that the bank was aware of mismanagement at Salander’s gallery when it loaned him money. First Republic has now agreed to pay the first $2.5 million from the sale to unsecured creditors involved in the case.
UPDATE: http://www.artnews.com/issues/article.asp?art_id=3008
Untangling the Salander Mess
Earl Davis consigned works by his father, Stuart Davis, to Salander. Now, more than 90 works, including Red Still Life, 1922, are missing.
©ESTATE OF STUART DAVIS/LICENSED BY VAGA, NEW YORK
Dozens of victims of Lawrence Salander’s fraud are fighting to recoup their losses of art and money, producing competing lawsuits and multiple claims for the same artworks
by Eileen Kinsella
More than two and a half years after Salander-O’Reilly Galleries collapsed into bankruptcy, investors and other art experts are still sorting out claims linked to hundreds of artworks as they attempt to untangle owner Lawrence Salander’s convoluted and fraudulent business dealings.
In March, the dealer, who is free on $1 million bail, pleaded guilty to 29 counts of grand larceny and one count of scheming to defraud. He was ordered to repay his victims fully—the Manhattan district attorney’s office estimated the overall scope of his fraud at $120 million—and he faces 6 to 18 years in state prison. Sentencing was scheduled for June 23.
Salander has admitted to selling artworks he did not own and keeping the proceeds. He frequently exchanged works he did not own to satisfy outstanding debts; solicited investments to purchase artworks or shares in artworks that he then improperly resold to other clients; and failed to inform or pay consigners when their works were sold.
When he pleaded guilty, Salander stated in court, “I presented investment deals in two ways, as pre-sale investments and speculative investments. I defrauded investors in both pre-sale and speculative investments in a variety of ways…. for example, by selling three one-half shares of the same work.”
Afterward, Manhattan district attorney Cyrus R. Vance Jr. said, “Lawrence Salander’s desire for an extravagant lifestyle turned long-time friends and trusted business colleagues into his personal piggy banks. The defendant not only stole money from his victims, but in some cases he stole their family’s heritage.”
Salander’s criminal-defense attorney, Charles Ross, did not respond to requests for comment, but he told ARTnews he had advised Salander not to give interviews. Last summer, the district attorney also arrested and indicted Salander’s former gallery director, Leigh Morse, on charges of “stealing from and defrauding consigners of art.” Morse was free on bail as well, pending a hearing scheduled for June 24.
Salander’s fraud ensnared a lengthy list of victims, ranging from museums, banks, and individual investors to consigners, collectors, and former friends. The list includes celebrities such as the actor Robert De Niro, who consigned his artist father’s works to Salander, as well as the former tennis pro John McEnroe, who reportedly once interned at the gallery to learn the art trade. Salander admitted to defrauding Renaissance Art Investors, collector Hester Diamond, Connecticut-based hedge-fund manager Roy Lennox, and Gerald Peters Gallery, among others.
He admitted to stealing from Earl Davis (son and heir of Stuart Davis), the estate of Elie Nadelman, the estate of Giorgio Cavallon, the estate of Louis I. Kahn, and the Lachaise Foundation, as well as the estate of Robert De Niro Sr.
Some collectors and creditors have been successful in getting at least a part of their art or money back amid ongoing bankruptcy proceedings. In January, De Niro paid $14,000 in exchange for the return of six of his father’s paintings. Dozens of other victims are still fighting to recoup their losses, pursuing Salander—and sometimes one another—in court. In many cases, there are multiple ownership claims for the same work.
The Philadelphia Museum of Art sued its insurer, AXA Art Insurance, in an attempt to recoup $1.5 million in losses for two paintings—by Maurice Prendergast and Arthur B. Davies—consigned to Salander-O’Reilly Galleries. Its suit states that the dealer sold the paintings without informing museum officials and kept the proceeds. AXA has denied the claim, taking the view that the museum is responsible for its own business dealings and should have performed due diligence to protect its interests.
In a complaint filed in May 2009, McEnroe and Morton A. Bender, a Washington, D.C.-based trustee of the Dorothy G. Bender Foundation, sued collector Joseph Carroll over his acquisition of a painting by Arshile Gorky referred to in their lawsuit as Pirate II. According to the complaint, in October 2004 the painting was on display at an auction in Paris of the collection of the late Julien Levy, a New York dealer. Salander approached Bender and proposed a partnership to buy both Pirate II and Pirate I (the complaint does not specify where Pirate I was purchased).
“Specifically,” the complaint reads, “Salander proposed that Bender purchase 50% of Pirate I and Pirate II for $2,039,830 and that Bender advance a loan of $2,155,046 to Salander Galleries with 12% interest representing Salander Galleries’ share for the purchase of the remaining 50% interest in Pirate I and Pirate II.” The price for both paintings was $4.19 million. Bender accepted the offer, and the deals were documented in writing.
In the same month, the suit states, Salander approached McEnroe and offered him a 50 percent interest in the same paintings, Pirate I and Pirate II, in exchange for $2 million. McEnroe also agreed to the deal. As with many of the investment transactions that Salander structured this way, he told his backers that he already had a buyer or buyers lined up so that the work could be resold quickly for a profit in which the investors would share.
In early 2007, McEnroe found out that Salander had sold Pirate II without his consent, the complaint states. And “despite the fact that Bender owned a 50% interest in Pirate I, Salander falsely represented to McEnroe that he…had the sole, exclusive and unencumbered right to sell or market Pirate I and to retain 100% of the proceeds.”
According to the complaint, instead of marketing and selling Pirate II, Salander “entered into a series of improper transactions, without [Bender's and McEnroe's] knowledge or consent, culminating in the subsequent sale of Pirate II” to Carroll. As outlined in the court filing, Salander created shell companies to which he transferred investments. In this case, he transferred the gallery’s interest in the work to an entity called the Seven Salander Children Group before it was ultimately transferred to Carroll in an exchange/buyback agreement. McEnroe and Bender allege that Carroll should have been aware that the exchange was “far below Pirate II’s fair market value.”
In a statement provided to ARTnews, Carroll’s lawyer, Jeffrey Udell, said that “Joe Carroll is yet another victim of the deceptive conduct of Lawrence Salander.” Udell says that before buying Pirate II, Carroll performed “standard and extensive due diligence, the result of which revealed no ownership interest in Pirate II by either John McEnroe or Morton Bender. Mr. Carroll thus purchased the painting in the utmost good faith and acquired clear title to the work.”
In a March 2009 letter addressed to the New York gallery Edelman Arts, an attorney for Bender wrote, “It has come to our attention that The Pirate II is presently on display at [a booth] at The Armory Show…[as] part of a ‘private collection.’ The Bender Group never sold or authorized the sale…and continues to assert that it owns a 50% interest in The Pirate II.”
Carroll has also been sued by Earl Davis, who alleges that Salander transferred eight works by Stuart Davis to Carroll without Earl Davis’s knowledge or permission.
One Salander victim, who did not want to be identified, said, “People have said to me, ‘You’re a smart guy. How could you have been taken in by him?’” As in the case of Bernard Madoff, Salander’s reputation as a highly respected and successful dealer, as well as his apparent ability to charm friends and colleagues, gave those who did business with him a sense of confidence.
Salander’s private residences included an elaborate town house on the Upper East Side of Manhattan and a 60-acre estate in Millbrook, New York. Salander has seven children, three from a prior marriage and four with his second wife, Julie. He rented the Frick Collection to throw Julie a 40th-birthday party. Former friends said he traveled exclusively on chartered jets, for business trips to Italy or to art fairs. One source, who lost millions of dollars to Salander and who did not want to be identified, remembered walking into a birthday party for one of Salander’s children to see Robert De Niro handing out pizza.
The town house is under contract for a figure “very close” to the asking price of $14.25 million, according to Lydia Rosengarten, a broker with Realtor Leslie J. Garfield & Co. Large groups of rare books, carpets, furniture, and decorative arts taken from Salander’s properties have been brought to auction, with the proceeds earmarked for the bankruptcy estate. Antique furniture and rugs were sold by the Hudson Valley auctioneers Stair Galleries in May and raised $552,000, with the proceeds earmarked for repaying creditors. Additional property from the Millbrook estate is scheduled for sale at Stair in July.
Joseph Sarachek, of Triax Capital Advisors, who was appointed chief restructuring officer of the Salander bankruptcy case shortly after it was filed, in 2007, told ARTnews at the time that more than 4,200 items from the gallery and the Manhattan and Millbrook residences were inventoried, including paintings, sculptures, and antique furniture and rugs.
Christie’s announced the sale in June of 130 Old Masters and 19th-century works, including paintings by Rubens, Palma Vecchio, and Jacopo Bassano, from the bankruptcy estate of Salander and the galleries. The sale was expected to realize in excess of $2.5 million, according to a Christie’s statement. Given the often contentious procedural wrangling that has characterized this bankruptcy, the trust—the entity that is overseeing execution of the bankruptcy settlement—secured title insurance protection on each lot so that clients could acquire works with the confidence that they are free and clear of any claims or liens, according to a Christie’s spokesperson.
According to court documents, the first $2.5 million in proceeds has been earmarked for the unsecured creditors committee, which represents the Salander creditors who are deemed lower priority on the repayment list than “secured” lenders. Among the secured lenders is the Bank of America subsidiary First Republic Bank, to which Salander owes more than $30 million. Salander admitted to submitting a fraudulent loan application to Bank of America for a $2 million personal loan in which he pledged artworks he didn’t own as collateral.
Some victims have abandoned their recovery efforts, noting that the legal costs would almost certainly outweigh any funds or assets they might recoup. Many of Salander’s victims did not want to be interviewed or speak on the record about their claims because of ongoing litigation.
As in a Ponzi scheme, many of Salander’s victims were lured by quick profits paid with money whose source Salander misrepresented. But once he had an investor on the hook, the payouts vanished. For example, Roy Lennox, a hedge-fund manager and Millbrook neighbor, met Salander in late 2001. In 2003 Salander persuaded him to invest $400,000 for a 50 percent share in a painting by Corot. Salander told Lennox he could purchase the work for $800,000 and already had a buyer lined up who was willing to pay $1.25 million for it. Lennox agreed to the proposal and one year later received his initial $400,000 back as well as a payment of $225,000, the supposed return on his investment.
The next month, February 2004, Salander approached Lennox with a similar proposition. He offered him a 50 percent interest in a sculpture by the 16th-century Italian Santi Buglioni, San Giovanni da Capestrano, for $375,000, promising Lennox that he would get back $550,000, which Salander “personally guaranteed.” Over the next few years, Salander approached Lennox with about a half dozen similar proposals, offering him shares of works by such artists as Goya, Stuart Davis, Marsden Hartley, and Jackson Pollock. But Lennox rarely received payments, and the few he did receive were much smaller than had been promised.
Salander eventually began offering to repay him with works from the gallery inventory, court filings state. On one occasion, he sent Lennox a number of works “he selected without consulting Lennox. Lennox returned them.” Lennox’s lawsuit against Salander seeks $4.8 million in damages and funds owed. It is still pending before the bankruptcy court.
Another major claim against Salander was brought by Renaissance Art Investors, which is controlled by Donald Schupak, chairman of Triumph Apparel Corporation (formerly Danskin). Schupak, who has retained Barry Slotnick as his attorney, seeks as much as $22.5 million in property and funds related to a consignment agreement with the gallery. Slotnick said that Salander’s guilty plea gave RAI “some measure of satisfaction. But knowing that Mr. Salander will be spending time in jail does not erase the fact that he defrauded RAI out of tens of millions of dollars, which has yet to be repaid.”
One of the hardest-hit victims in the Salander fraud was Earl Davis, who for more than two decades maintained a friendship and business relationship with the dealer. Hundreds of his father’s works were consigned to or stored in the gallery and were frequently loaned to museums or other venues. They were covered by an agreement under which Davis retained the right to approve sales before they were executed.
According to his complaint against Salander, the arrangement started unraveling in 2005, when the gallery appeared to have what Davis described as “bookkeeping problems.” Davis learned that some of the most important paintings in the estate had been sold, but Salander had neither informed him of the sales nor remitted the proceeds, according to court filings. Two of Davis’s works turned up in a show at the Whitney Museum with the owners listed as people other than Earl Davis (the suit did not identify them). Another art gallery was selling five of his works, and Carroll confirmed to Davis that he owned ten, court papers reveal.
Gallery invoices, including those seized by the district attorney, showed that Salander had sold many of these works, taking in at least $9 million over the years. Davis also discovered, through searches of New York state financial filings, that Salander had pledged at least 14 works by his father as collateral to secure debt obligations. Davis demanded, in 2006, that the gallery cease all sales and return his inventory, and later obtained a court order supporting his claims, but he is still missing more than 40 paintings and 50 works on paper created by his father. As a result of the gallery bankruptcy filing, the transfer of numerous Stuart Davis works both within and outside the United States, and Salander’s extensive sales to “good faith” buyers, Davis’s legal recovery efforts have proved impossible in some cases and extraordinarily expensive at best.
Until the end, when his business finally collapsed, Salander apparently believed he could talk his way out of the mess he had created. In a late 2006 e-mail to Davis, the dealer wrote, “The only thing that could stand in the way of paying you would be my death….The fact is your trust was, is and will be well placed with me. You will get paid every cent you are owed.”
According to a mid-2008 court filing, Salander’s friend Michael Lewitt, a Palm Beach money manager, was supplying the dealer and his family with $25,000 a month for living expenses. Lewitt did not respond to a request for comment.
Through an entity called Galleon Group LLC, Lewitt operates a Westchester gallery near Salander’s Millbrook home, called Phoenix Art, at which Salander is an unpaid employee.
It’s a far cry from the lavish showcase on East 71st Street where Salander once reigned. A guest who was among the throng at the opening party there in 2005 remembered complimenting the dealer on his new space.
Salander replied, “I’m either going to make a killing or it’s going to kill me.”
Eileen Kinsella is editor of ARTnewsletter.