Bloomberg has the news of a ring of forgers passing off fake Maleviches and Kandinskys has been broken by German police:

The forgers are suspected of selling more than 400 works since 2005, for prices ranging from 1,000 euros ($1,332) to more than 1 million euros, the police said. Searches were also carried out in Switzerland and Israel and the nationalities of suspects are Russian, Israeli and German-Tunisian, police said.

“These investigations are a successful blow to an internationally active forgery scene,” Joerg Ziercke, the president of the Federal Criminal Police Office, said in a statement. “Our close coordination with partners in Switzerland and Israel has allowed us to put a stop to these criminals.”

The two people arrested, who are 41 and 67 years old, are suspected to be the leaders of an international group of six forgers, police said, adding that they found suspected forgeries and sales documents in their apartments. The forgers copied the style of artists including Natalia Goncharova, Alexej Jawlensky and Mikhail Larionov and passed the paintings off as unknown works, the police said.

Most of the paintings were acquired by private collectors in Germany, the police said. The two people arrested may in the last two years alone have sold forged paintings for more than 2 million euros to collectors in Germany in Spain, police said.

Forgery Ring Broken Up, Two Arrested, German Police Say

The Los Angeles Times reports on the simmering scandal involving American antiquities dealer, Subhash Kapoor, and the works of Indian antiquities that he seems to have smuggled out of the country and sold to many museums including the Met, LACMA, the Art Institute of Chicago and, in what has now become a significant case, the National Gallery of Australia.

Although the museum believes it has documents showing the ownership history of this dancing Shiva sculpture, Federal authorities say the documents are forgeries. Here’s how the LA Times pieced together the case:

In 2005, Indian investigators say, Kapoor traveled to Tamil Nadu, India, where he asked the alleged head of a ring of idol thieves for prized bronzes from the Chola kingdom, which ruled south India from the 9th to the 13th centuries. Over the next several months, thieves broke into a local temple and stole the Shiva and seven other idols, the investigators say.

The alleged smugglers sent digital pictures of the Shiva to Kapoor in October 2006, documents reviewed by The Times show. The idols were then mingled with replicas, certified as modern handicrafts and shipped to Kapoor’s New York company in the fall of 2006.

Kapoor went on to publish a photo of the Shiva in his catalog, calling it “the largest, most significant Chola Period sculpture of this subject to appear on the market in a generation.” The asking price was $5 million.

Radford, the Australian museum director, saw the statue in New York during a visit with Kapoor, records show. The bronze was shipped to the Australian museum for consideration in October 2007, records show, and the museum asked Kapoor for additional documents.

In February 2008, the records show, Kapoor or someone in his office created a Word document titled “Purchase Invoice, 18 October 2004.” The document was presented as evidence that Kapoor had purchased the Shiva from a Washington, D.C., collector four years earlier, according to the sources familiar with the investigations, who declined to be identified because the inquiries are ongoing.

Soon after, the National Gallery purchased the statue for $2 million U.S., records show, and put its image on the cover of a 2008 annual report. The museum did not respond to emailed requests for an interview with Radford.

Feds pursue Manhattan art dealer suspected of smuggling (Los Angeles Times)

Anthony Shaia claims to have had an 800-piece art Southeast Asian art collection in his Eugene, Oregon home that was stolen 18 months ago. Because Shaia lacks the supporting evidence, he’s had to take matters into his own hands to recover the works.

That backfired in April when Shaia took matters into his own hands. With a .38 handgun, he confronted a person he suspected had knowledge of the theft.

“There’s no way that I’m going to give up,” Shaia said. “This has been my life’s work, and it’s been devastating to deal with having it stolen.”

Shaia said he returned from a trip to California in November 2011 to find his home in Eugene’s College Hill neighborhood stripped of the artwork. He’d hung some of the pieces on his walls, and kept the rest in a closet.

Shaia reported the theft to police, who have followed up on a number of leads.

But at this point, detectives can’t do anything more with the case, in part because Shaia never insured his collection and didn’t provide investigators with sufficient documentation to show he had owned all of the items that were reportedly stolen from his home, police spokeswoman Melinda McLaughlin said.

Man Whose Art Was Stolen Admits Coercion (Registered Guard)

The Art Newspaper reports the recent Latin American sales in New York saw dealers raise doubts about works at Phillips and Christie’s. Both houses pulled the works before the sales but the more significant number was at Christie’s where a single consignor created the most exposure:

Christie’s withdrew ten works by Brazilian artists from its auctions of Latin American art in New York last month (scheduled to take place on 29 and 30 May). The works, allegedly by artists including Ivan Serpa, Mira Schendel, Roberto Burle Marx, Ione Saldanha, Hércules Barsotti, Ubi Bava and Amílcar de Castro, were “withdrawn pending additional research”, says a spokeswoman for the auction house.

All of the works came from the Rio de Janeiro-based Ralph Santos Oliveira collection. The collector told the Brazilian newspaper Folha de S.Paulo that he was “shocked” by the removal of the pieces. He said he had tried to place them at auction on behalf of the owner, his grandmother, who suffers from Alzheimer’s disease and cannot recall where the works were bought.

Christie’s Pulls Works After ‘Forgery’ Concerns (The Art Newspaper)

Johann Liss, An Allegory of Christian Faith

The Cleveland Museum of Art has paid the heirs of Arthur Feldmann, an art dealer murdered by the Nazis, for a drawing in the museum’s collection:

Feldmann, according to the museum’s statement, died in 1941, two years after he was arrested and tortured by the Nazis when they invaded the city of Brno in the present-day Czech Republic. Feldmann’s wife, the statement said, was deported to the Theresienstadt concentration camp and later Auschwitz, where she too died.

According to numerous reports, the Nazi Gestapo, or state secret police, confiscated Feldmann’s collection of approximately 750 Old Master drawings. Hitler’s aim was to build a museum of stolen masterpieces as a monument to the Third Reich.

Cleveland museum Director David Franklin said the institution agrees that the Liss drawing, entitled “Allegory of Christian Faith,” once belonged to Feldmann, although he said “there was some vagueness as to whether the drawings were seized by the Nazis or not.”

Yet he said, “we felt it was the honorable thing to meet the family halfway and give them the benefit of the doubt.”

“We were willing to give them fair market value to keep the drawing in the collection,” Franklin said, “and they were happy to have the drawing remain in a public collection and to honor the fact that we looked after it so well for so long.”

Cleveland Museum of Art settles claim over Johann Liss drawing said to have been taken by Nazis from Feldmann collection (Cleveland Plain Dealer)

Time and again it has been illustrated that art thieves are more sophisticated in their ability to plan and execute a robbery than they are in figuring out how to dispose of the works that are almost always unsaleable. Now police fear that the latest €100m high-profile theft of  Picasso’s Tete d’Arlequin, Monet’s Waterloo Bridge and Lucian Freud’s Woman with Eyes Closed  from a Rotterdam museum may have resulted in the destruction of the works. Here’s AFP on what’s been happening after police tracked the works to Romania:

“Tests are underway, they will take some time,” Gabriela Neagu, a spokeswoman for the Romanian prosecutor’s office, told AFP. ”The ash tests are a stage in the ongoing probe, investigators have to take every hypothesis into account.”

The ashes were taken from the house of Olga Dogaru, mother of one of the suspects and herself charged with “complicity to theft.”

Her son’s lawyer, Doina Lupu, said the tests “were inconclusive” so far.

Ms Dogaru was arrested in March after her house in eastern Romania was thoroughly searched. An empty suitcase which had presumably served to store the stolen paintings was unearthed during the operation.

Seven Romanians, including Ms Dogaru, have been charged in connection with the theft of the paintings from Rotterdam’s Kunsthal museum on October 16.

Stolen artworks from Picasso, Money and Matisse may now just be ashes (AFP)

Spies, La Beraudiere, Reijtenbagh

Noted Max Ernst scholar, Werner Spies, has had his share of trouble over authenticating works. Today it was announced that Spies will be held responsible for paying half the €652,883 owed back to investor Louis Reijtenbagh for a painting “Earthquake” sold by Geneva gallerist Jacques La Béraudière as authentic based upon Spies’s authoritative opinion.

Reijtenbagh has already had his share of troubles too with the art market. A substantial collector, he got caught selling works that were being offered as collateral for multiple loans.

Art historian Werner Spies convicted poorly authenticated a painting by Max Ernst (Fr.YahooNews)

Bloomberg looks behind the scenes at the FBI’s National Stolen Art File led by Bonnie Magness-Gardniner:

The black-market in art “is a very large enterprise,” Magness-Gardiner said in an interview. “Stolen art, stolen antiquities move into a legitimate market very easily.”

Her office serves as a hub for federal law enforcement efforts to combat art theft. She oversees the National Stolen Art File, a database of stolen art and cultural property, as well as the FBI’s “Top Ten Art Crimes” — a Most Wanted list for historic valuables.

Made up of 14 special agents and three prosecutors, the team operates around the country, with each agent in the field overseeing a different region. The team got its start after the looting of cultural treasures in Baghdad following the U.S. invasion of Iraq and has cultivated international ties as it does its work.

To date, the team has recovered more than 2,650 items with a value of more than $150 million, according to the FBI.

Purloined Picassos Chased by FBI Art Sleuths for Wealthy (Bloomberg)

The latest turn in the Glafira Rosales case is her arrest today on tax evasion charges. The surprises are manifold, including the question why Rosales remained in the US when she has bank accounts abroad; but the one getting the most attention is the government’s decision to pursue tax charges instead of crimes related to selling fakes:

Federal authorities declined to comment on the decision not to charge Ms. Rosales with anything related to the sale of counterfeits. But the complaint they filed discussed in some detail their reasons for believing them to be fake and focused on holes in her accounts of how she had obtained them from two collectors. The first collector did not exist, investigators said, and the second denied ever owning the paintings in an interview with the F.B.I. In addition, authorities said that much of the money Ms. Rosales received as the broker in the sale should have been turned over to a collector, if one existed, but instead was largely kept by her.

In presenting their charges on Tuesday, the authorities outlined the details of an international scheme they said clearly showed Ms. Rosales’s efforts to profit from counterfeiting.

In all, they say, she sold about 63 works to two prominent art dealers in New York between 1994 and 2008. But the case focused on 2006 to 2008 when investigators found irregularities in her tax filings, and 2007 to 2011, when they say she kept undisclosed foreign bank accounts.

Dealer at Center of Art Scandal Arrested on Charges of Tax Evasion (New York Times)

The US Attorney has filed charges against the central figure in the Knoedler forgery cases, Glafira Rosales. The government is using the tax case to bolster its claim that Rosales sold fake works of art to the gallery which then sold those works to collectors:

In contrast to the claims made by ROSALES, the investigation has revealed that:

• experts in the fields of art, art history, and materials science have concluded that at least several of the paintings sold by her are counterfeit;
• the Purported Swiss Client on whose behalf she claimed to sell most of the paintings to the Manhattan galleries never existed;
• the Purported Spanish collector on whose behalf she claimed to sell the remainder of the paintings to the Manhattan galleries never owned the paintings; and
• instead of passing along a substantial portion of the proceeds of the sale of the various paintings, she kept all or almost all of the proceeds, and transferred substantial portions to an account maintained by her then-boyfriend.

ROSALES filed tax returns that falsely claimed she had not kept all, or almost all of the proceeds from the sale of the purported clients’ paintings, when, in fact, she had. Further, there was no Swiss client and no Spanish collector. In total, she failed to report the receipt of at least $12.5 million of income for the years 2006 through 2008.

Manhattan U.S. Attorney Charges Art Dealer With Hiding Millions Of Dollars In Income From Fraudulent Sales Of Artwork(Manhattan US Attorney)