He has been condemned as a “serial swindler”, who duped art investors into parting with an eye-watering $86m, but his victims will never forget the charm and charisma of Inigo Philbrick.
The suave American dealer, with a gallery at an exclusive London address, a Midas touch that brought soaring profits in art sales and a socialite girlfriend from Made in Chelsea, had in fact been running a fraudulent business. This week, he was sentenced to seven years in a US jail, with two years of supervised release and an order “to pay a forfeiture of $86,672,790”.
His was a smoke-and-mirrors trade that involved selling a total of more than 100% of an artwork to multiple investors without their knowledge, using works as collateral on loans without informing their co-owners, and falsifying documents to inflate artwork values, with one contract listing a stolen identity as the seller, according to the US Department of Justice. A life of crime funded Philbrick’s life of luxury, reportedly ranging from travel on private planes to drinking the finest wines at £5,000 a bottle.
But the law finally caught up with him. In the autumn of 2019, a lender officially notified Philbrick that he was in default of a $14m loan, and by November 2019, various investors had filed civil lawsuits. Having made his escape to a remote Pacific island, he was eventually arrested in 2020, finding himself going from paradise to prison. Last November, Damian Williams, the United States attorney for the Southern District of New York, announced that Philbrick had pleaded guilty before United States district judge Sidney H Stein to one count of wire fraud for perpetrating a scheme to defraud various individuals and entities in order to finance his art business. According to the complaint, “Philbrick fraudulently obtained more than $86m as a result of the scheme … Philbrick made material misrepresentations and omissions to art collectors, investors, and lenders to access valuable art and obtain sales proceeds, funding, and loans.”
When Judge Stein asked him why he committed the crime, Philbrick replied: “For the money, your honour.” He was no doubt being honest then. Prosecutors believe that his fraudulent scheme was operating between 2016 and 2019 and that contemporary artworks caught up in his complex web include Jean-Michel Basquiat’s 1982 painting Humidity and Rudolf Stingel’s 2012 photorealist-style portrait of artist Pablo Picasso .
His victims include Kenny Schachter, an American artist, academic and writer, who lost more than $1.5m to Philbrick. “He misappropriated my funds, my art, like he did with many people,” he says. What makes it all the more painful is that they were once friends, close enough to have holidayed together, and he remembers Philbrick as a “very talented art dealer” who was “sharp, fun and funny”. He likens him to America’s most notorious Ponzi conman, Bernie Madoff, who died in prison, having robbed thousands of victims worldwide of billions of dollars, describing Philbrick as a “mini Madoff”, who was brought down “mainly” by “a toxic mix of arrogance and alcohol”.
Several civil lawsuits are being pursued to determine legal title to artworks that Philbrick allegedly oversold or used as collateral on loans.
Judd Grossman, a New York lawyer, is representing several victims, including Satfinance and financial adviser Aleksandar Pesko, who has two separate lawsuits over two paintings – Basquiat’s Humidity and Stingel’s Picasso portrait: “Everyone’s litigating right now – not really against Philbrick. He doesn’t have anything. They’re litigating against the artworks that have been located.” The Basquiat and Stingel are both in New York, subject to injunctions, meaning they will stay put until the respective cases are resolved.
Grossman says: “Philbrick was selling interests without disclosing the fact of that transfer and, in some instances, selling more than 100 per cent of the work … he lied not only about the purchase price, but ultimately stole the work and tried to pledge it as collateral on a loan.”
A letter submitted to Judge Stein by Philbrick’s lawyer, Jeffrey Lichtman, ahead of sentencing this month, acknowledges as much. It states that Philbrick’s use of alcohol and drugs began at school and “intensified as he entered London’s art world”, adding that this was “how art deals are done”. Schachter adds: “He’s made mistakes and he’s sabotaged his entire life for short-term greed. It’s just stupidity.”
In his submission, Lichtman admits that his client claimed to Pesko that he had purchased the Basquiat work for $18.4m “before selling a 50% stake to Pesko based on his inflated purchase price for $9.2m and also receiving a $3m loan from him”. “Philbrick then sold another 12.5% stake in the work to a third individual, Damien Delahunty [a London art dealer], for $2.75m, claiming that he had actually purchased the work for the even greater inflated price of $22m, lying that he and Delahunty would together own 25% of the work, with an undisclosed third party holding the remaining 75%. Thereafter, this work and others were utilised as collateral by Philbrick, without disclosing other ownership interests, to receive a $13.5m loan from Athena Art Finance Corp.”
Grossman describes Philbrick’s fraud as “sophisticated”: “Among other things, he forged documents, including a Christie’s consignment agreement, a purchase and sale agreement and bill of sale, and a Christie’s invoice.”
Philbrick’s fraud was exposed in 2019, following rumours of shady dealings and investors demanding the return of investments or artworks. Facing multiple lawsuits, he fled to the Pacific island of Vanuatu, where he was arrested by US law enforcement agents. FBI assistant director William F Sweeney Jr said then: “Philbrick allegedly sought out high-dollar art investors, sold pieces he didn’t own, and played games with millions of dollars in other people’s money. The game ended when investors began wondering where their money went.”
Philbrick, whose boyish good looks have been likened to the pop star Justin Timberlake, was born in England 34 years ago. He grew up in Connecticut, the son of a respected former museum director and a Harvard-educated writer and artist, who divorced when he was a teenager, devastating the family financially and emotionally, according to court papers.
He studied at Goldsmiths, University of London, entering the art world in 2010 as an intern at the White Cube gallery in London, where he soon became head of secondary market sales. In 2013, he established his own contemporary art gallery, in Mayfair and, after a reported turnover of about $130m in 2017, he opened a branch in Miami, Florida.
His business was said to have been backed by Jay Jopling, founder of the White Cube, who said in a statement: “It has hurt and saddened me that Mr Philbrick, whom I respected and whose early career I supported, has not only betrayed my trust, but, it appears, that of many others.” Jopling’s spokesperson said that he “has suffered substantial financial loss as a result of Mr Philbrick’s frauds”, adding: “As there are legal proceedings still ongoing in relation to these losses, we cannot comment further.”
The British artists Gilbert and George even gave the court a character reference, remembering Philbrick as “a very talented, extraordinary, charming, honest and decent young person”.
His relationship with the Made in Chelsea star, Victoria Baker-Harber, led to the birth of their daughter, Gaia-Grace, in November 2020. She even discussed Philbrick in a recent episode of the show, describing him as “the kindest person” and joking that he looked good in his prison uniform. “[Orange] is really not his colour. He was in a sort of khaki jumpsuit. It has a collar at least.” Approached by the Guardian, she declined to comment.
The art world is certainly no stranger to fraud and scandal. Recent cases, which include forgeries sold by the once-respected, now defunct Knoedler Gallery, reflect the greed and excess of a market that is poorly regulated, enabling buyers and sellers of multimillion-pound artworks to conceal their identities.
Sharon Flescher, executive director of the International Foundation for Art Research (Ifar), says: “Fortunately, scams like the Inigo Philbrick case don’t happen that often. But when they do, they expose the soft underbelly of an art world where large sums of money are transferred, often with little transparency.
“This case shows what happens when trust is misplaced and people of seemingly good background turn out to be dishonest. This was a massive fraud scheme involving millions of dollars, lies, deceit, fraudulent documents, and exaggeration. While the selling of more than 100% of ownership shares in an artwork was hilariously funny in Mel Brooks’s The Producers, it is not a laughing matter.”
Grossman believes that Philbrick was brought down by “a combination of greed, opportunity and the desire to be the art world’s next big thing”. “Once he got a taste of that success, and the lifestyle that his clients were leading – he’d made some money but he was not at the level of wealth of his clients – he wanted more.
“He abused his personal and professional relationship with his clients in order to perpetrate the fraud. All of these transactions involved a level of trust and, in these cases, were built on a good track record. He was making money and by all accounts there was no reason to believe that these were anything but legitimate transactions as far as my clients were concerned. During the course of these business relationships, some of these clients developed personal relationships, which only enhanced that trust. Ultimately, he perpetrated the fraud by abusing that trust and confidence.”
He adds that, while the victims “have lost real money, equally important, they feel that they’ve been taken advantage of in a real way … Any time you get defrauded and someone steals from you – especially when it’s someone who has developed this level of trust – it’s a devastating, life-altering event.”