By Matthew Fredrickson
Glafira Rosales was arraigned last month on criminal charges because of her suspected involvement in the sale of counterfeit artwork to two Manhattan galleries, but the charges seem inadequate. Starting in the early 1990s, Rosales allegedly resold 63 works of Pei-Shen Qian as those of more famous painters, making millions of dollars. The complaint against her originally alleged eight counts of tax fraud. On July 19, 2013, Rosales was arraigned on her first indictment, which added counts of wire fraud and money laundering. On August 19, she was arraigned again on a superseding indictment, which added conspiracy to commit wire fraud and money laundering.
After the first indictment, The Art Newspaper reported that allegations of Rosales’ false statements and sale of counterfeit artwork constituted wire fraud. Though this classification is essentially true, these charges appear to have very little to do with the false statements and counterfeit pieces themselves, or the damage to the international art community. These charges do not appear to punish the real crime: stealing the artists’ names.
The crime of wire fraud treats Rosales’ counterfeiting activities as secondary. Wire fraud, as described in 18 U.S.C. § 1343 (2013), criminalizes the use of “wire, radio, or television communication” to further a “scheme or artifice to defraud.” This statute does not focus on the fraud as a wrongful act itself. With its elements requiring use of wires to further the scheme; a title specifying “by wire, radio, or television”; and its stark contrast with another section in its chapter, 18 U.S.C. § 1341 (2013), which requires something be “sent or delivered by the Postal Service” to be a violation, this statute has a substantial focus on the use of wires in successfully defrauding others—as if that were the act society needed criminalized. As it reads, this statute has very little focus on fraud, which need only be an intention to devise a scheme to defraud, for there to be a conviction.
If that statute was all the prosecutors had to work with, then the charge would not appear so insufficient, strange, and anticlimactic. However, there are charges more relevant to the actual fraud available to the prosecutors. It is a federal crime to traffic in counterfeit or illicit labels and counterfeit goods. By associating the name of famous painters with Qian’s works and then reselling those works at greatly inflated prices, Rosales appears to have violated these two laws. A conviction on these charges would better speak to the evils of the fraud itself. By charging Ms. Rosales with violations of these statutes, the fraud remains at least a part of the indictment and it sends a message to others who might try the same act but be smart enough to do so without violating the wire fraud statute as well. With their indictments, the prosecutors seem to be picking the easier charge to prove without concern for the devastating effects of the fraud and the message that needs to be sent.
Here, the real damage to the art community is the dilution of these painters’ names and legacies, a corruption in the sanctity of art and the will to produce art, and the deflation in buyers’ and consumers’ confidence in the art producing and dealing process. The civil lawsuits, detailed by BLOUIN ARTINFO, that were brought as a result of this scandal were not concerned with the use of wires to perpetuate the fraud. Instead, the suits were concerned with the fact that the paintings were not authentic. That is, the cause of the anger, and thereby the wound, was the theft, the lying, and the fraud. What message does a charge that appears to marginalize the cause of the anger, the wound, send—especially when other charges, which are more on-point could be brought but never are? The message: do not use a wire, radio, or television to commit the fraud. For now, reparations will be the privilege of the wealthy few who bought the paintings, not the art community as a whole. With their charges, the federal government has done little to repair the lack of faith the art producing and dealing community is facing.
Washington Journal of Law, Technology & Arts 