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A young art dealer with a gallery in London’s Mayfair district, Inigo Philbrick was a brash fixture in the post-war and contemporary art world for years.
Known for traveling by private jet, renting villas in Ibiza and wearing handmade Italian suits, he was also known for attracting people to invest in paintings by world-class artists such as Jean-Michel Basquiat, Rudolf Stingel and Christopher Wool.
On Thursday, Mr. Philbrick appeared in ankle chains in Federal District Court in Manhattan and pleaded guilty to wire fraud, admitting to deceiving people while doing business as an art dealer in New York and elsewhere.
“I knew what I was doing was wrong and illegal,” he told Judge Sidney H. Stein, adding that he was motivated by a desire for money.
As part of his defense, Mr. Philbrick, 34, has agreed to forfeit $86 million and forfeit all interest in a 1998 painting by Wool and a 2018 painting by Wade Guyton. He is scheduled to be sentenced in March and faces up to 20 years in prison.
Mr. Philbrick, an American citizen studying at Goldsmiths, University of London, was in his 20s when he opened the gallery and consultancy.
Mr. Philbrick specializes not in showing new works or guiding careers, but in reselling or “flipping,” a speculative art form in which investors buy ownership stakes in artworks and hope to make a profit when those items are sold.
The hoaxes Mr. Philbrick is accused of committing are rooted in the opacity of the resale market, where it can be difficult to verify how much works are bought and sold for. As a result, the value of shares in a work of art is often based on little more than a seller’s word.
“Inigo Philbrick was a serial con man who financed his art business and lifestyle to defraud art collectors, investors and lenders of more than $86 million by taking advantage of the lack of transparency in the art market,” said Damian Williams, US attorney. Southern District of New York.
From about 2016 to 2019, the complaint in Mr. Philbrick’s case said he misled collectors and lenders, sometimes selling more than 100 percent total property in a piece of art to multiple investors.
Prosecutors also said he had drawn up “false and fraudulent sales and shipping contracts to artificially inflate the value of his artworks and hide the discovery of his scheme”.
Prosecutors said, for example, that in 2016 Mr. Philbrick purchased the Basquiat painting entitled “Moisture” in 1982 for $12.5 million in a private sale. Mr. Philbrick later sold the shares in the painting to two investors while filing false documents showing the purchase prices of $18.4 million and $22 million, according to the complaint.
Mr. Philbrick was also accused of using the Basquiat painting as part of his collateral for a multimillion-dollar loan from Athena Art Finance Corp., an art loan business in Manhattan, without disclosing other investors’ ownership interests in the work.
Prosecutors have disclosed similar issues in Wool’s untitled painting from 2010 and Stingel’s 2012 untitled painting depicting Pablo Picasso. In the second lawsuit, Mr. Philbrick was accused of selling more than 100 percent of the shares in the painting to unwitting investors.
Mr. Philbrick’s plan began to emerge in 2019 when investors learned that he had provided false documents regarding Stingel and Basquiat.
By November, investors had filed civil lawsuits in connection with Mr. Philbrick’s activities. His gallery in Miami was closed. It turned out that he had disappeared.
Then, in June 2020, Mr. Philbrick arrested It was transported by US law enforcement to the Pacific island of Vanuatu and to Guam. Prosecutors said flight records showed he left the United States just before cases began to spread.
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