More arrests are expected in a conspiracy case against a New York art dealer suspected of selling millions of dollars in counterfeit paintings.

More arrests were planned in the criminal case against a New York art dealer accused of peddling counterfeit art for 15 years as the undiscovered works of famous artists including Jackson Pollock and Willem de Kooning, a prosecutor said Monday.

Assistant U.S. Attorney Jason Hernandez made the disclosure at the arraignment of Glafira Rosales, 57, of Sands Point, on Long Island. Rosales, standing beside her lawyer, pleaded not guilty to a superseding indictment that accused her of engaging in the scam from 1994 through 2009.

U.S. District Judge Katherine P. Failla asked Hernandez whether more arrests were planned and he said there were. As for the case against Rosales, he said it would likely be resolved without trial by the end of this month or next.

Glafira Rosales, an art dealer, was arrested for filing false tax returns and for failing to disclose a foreign bank account to the IRS. Rosales allegedly failed to report the receipt of at least $12.5 million in income from the sale of works purported to be by celebrated abstract expressionist artists. Most of the income was received in a bank account in Spain that Rosales hid from, and failed to disclose to, the IRS. She was arrested in Sands Point, New York, this morning and will be presented in Manhattan federal court this afternoon before U.S. Magistrate Judge Sarah Netburn.

Manhattan U.S. Attorney Preet Bharara said, “As alleged, Glafira Rosales gave new meaning to the phrase ‘artful dodger’ by avoiding taxes on millions of dollars in income from dealing in fake artworks for fake clients. Her arrest shows that no matter how clever the scheme, attempts to hide income from the government to avoid paying taxes on that income will be discovered and prosecuted.”

IRS Special Agent in Charge Toni Weirauch said, “The sale of a piece of art for profit is a taxable event, and the seller is responsible for paying his or her fair share of tax, even if the art is counterfeit. The allegations in this investigation illustrate a ‘double-barreled’ tax evasion scheme: disguising who was actually selling the art and profiting from the sales, through the creation of a fictitious seller and the use of the name of a collector not associated with the transactions, and further concealing the proceeds by depositing them in an unreported foreign bank account.”

FBI Assistant Director in Charge George Venizelos said, “As alleged, Glafira Rosales committed tax fraud in falsely reporting that she was selling art on behalf of clients. In truth, those clients were just part of the picture she painted to perpetrate her multi-million-dollar scheme. There is consistency in the scheme, however: the artwork Rosales sold appears to be as fake as her story about the clients she claimed to represent.”

According to the allegations in the complaint unsealed today in Manhattan federal court:

In the 1990s, Rosales, an art dealer, began selling previously unknown paintings that had never been exhibited before and that she claimed were painted by some of the most famous artists of the 20th century, including Jackson Pollock, Mark Rothko, and Willem de Kooning. From 2006 through 2008, Rosales sold approximately one dozen of these paintings to two prominent Manhattan galleries for over $14 million.

 

Read more…

Speak Your Mind

*