Sotheby’s carries on where it left off?

In 1997, Sotheby’s stopped holding regular antiquities sales in London. The final sale was held in November 1997. Sotheby’s announced its decision had been prompted by the declining profitability of its London operation when compared New York, but it was widely believed the decision owed more to allegations that Sotheby’s was selling trafficked material. Last year, Sotheby’s looks to have revived its London antiquities sales, an indication if any is needed of the increasing importance of London as an antiquities marketplace. This year the company has scheduled for 12 June its sale of ‘Ancient Marbles: Classical Sculpture and Works of Art’.

The ever vigilant Christos Tsirogiannis has discovered in the confiscated archive of Italian dealer Gianfranco Becchina images and documentation that seemingly relate to lot 8 in the forthcoming sale, described as ‘An Attic Marble Anthemion from a Grave Stele, circa 350-340 BC’. Sotheby’s provides the following provenance:

John Hewett, Bog Farm, Kent, 1960s; New York art market, acquired from the above on 3 November 1980; American private collection; American family trust (Sotheby’s New York, 10 December 2008, lot 28), acquired by the present owner at the above sale.

The stele was also offered at Christie’s London, 24 October 2013, lot 32, but did not sell. John Hewett was a leading antiquities dealer in post-war London, friendly with Peter Wilson of Sotheby’s and advisor to the Sainsbury Collection. He was also friends with collector George Ortiz.

From his research, Christos believes the stele was most likely discovered in Greece, and that it was in Becchina’s possession from 1977 until 1990, when it was sold to George Ortiz, who died in October 2013.

It is noticeable that the name of Gianfranco Becchina, who has been tried in Italy on charges relating to antiquities trafficking, does not appear in the Sotheby’s provenance. Did Sotheby’s choose not to include him, or did they not know about his previous possession of the piece? Either way, there are problems. The proposed sale of the stele calls into question Sotheby’s policies as regards acceptable provenance and appropriate publication of provenance, or else its due diligence procedures when researching provenance.

Christie’s welcomes work of Christos Tsirogiannis shock

My colleague Christos Tsirogiannis suggests two objects that were offered for sale in the 12 April Christie’s New York Antiquities auction had most likely passed through the hands of convicted antiquities dealers.

Photograph of hydria found in possession of Giacomo Medici

Photograph of hydria, found in possession of Giacomo Medici

Lot 36: A Greek black-glazed hydria, with an estimate of $8,000 – $12,000. The catalogue entry states that this hydria is from the collection of Charles Brickbauer of Baltimore, who bought it from Royal Athena Galleries of New York in 1988. Before that, it had been sold at Sotheby’s London on 10 December 1987 (lot 243). Christos discovered a photograph of the hydria among those seized from convicted antiquities dealer Giacomo Medici. Christie’s subsequently withdrew the lot from sale.

Photograph of head found in the possession of Gianfranco Becchina

Photograph of head, found in the possession of Gianfranco Becchina

Lot 70: A Roman marble janiform Herm head, with an estimate of $40,000 – $60,000. The catalogue entry describes the head as the ‘property of a lady’, with a provenance ‘New York, Boston & Texas, acquired prior to 1995; thence by descent to the current owner’. Christos identified the head on a photograph seized from the convicted antiquities dealer Gianfranco Becchina. Christie’s subsequently withdrew the lot from sale.

Interpol, the Italian Carabinieri, and relevant US authorities have all been notified.

By coincidence, Mike Pitts has just published an article in the May-June issue of British Archaeology about other identifications made by Christos. The article draws attention to an on-line piece written by a Christie’s specialist which suggests that ‘The ideal provenance traces the movement of an object from the point of excavation, sometimes as early as the 16th century, to the present day’. That hardly ever happens, of course. As the British Archaeology article shows, most objects offered for sale at auction have a provenance that can be traced back to between 1970 and 2000 but no further.

The date of 2000 is an important one. It is an open secret that Christie’s and perhaps other auction houses have adopted 2000 as a provenance cut-off, and are offering for sale objects with a collecting or trading history that can be demonstrated to stretch back to sometime before that date, but with no attempt being made to reconstruct a complete provenance. The danger of adopting the 2000 cut-off is that Christie’s leaves itself vulnerable to accepting objects that have been traded by Medici, Becchina or others of their ilk. Perhaps the company believes that the appearance of a couple of questionable objects in an occasional sale causes very little financial or reputational harm and considers it an acceptable cost of doing business. If that is the case, it is a poor reflection on its idea of ‘corporate social responsibility’, whereby it claims to support ‘the honourable and legal market in ancient art’. Christos will be pleased to learn, however, that Christie’s does see his own work as indispensable for the creation of a ‘legal market’, when it says that ‘we positively welcome and encourage scrutiny of our catalogues by museums, archeologists, collectors, law enforcement and government agencies’. Christie’s will surely join me in saying ‘thank you Christos, for your continuing efforts in creating a legal market and cleaning up the antiquities trade’.

David Gill has asked whether Charles Brickbauer will be returning the hydria to Italy, while Lynda Albertson has discussed the identifications in the context of statements made by representatives of the art market at a recent UNESCO meeting.

Antiquities at auction (1)

The Art Newspaper is reporting that for the auction houses Sotheby’s and Christie’s ‘Higher-volume, lower-priced business in the middle market could be the saleroom mantra for 2016’ as profits from the high-end market are squeezed. It reminds us that the auction houses are active commercial agents. They are not in business simply to facilitate transactions between buyers and sellers – they are in business to make a profit. With that rather obvious fact in mind, it is illuminating to look back over Sotheby’s New York sales records for non-Islamic antiquities from 1985 to 2013. The following series of graphs shows quite clearly how Sotheby’s has played the market.

Auctions 1

This first graph (above) shows how starting in 2001 Sotheby’s began offering fewer lots for sale annually, until about 2009, when the figure averaged out at just under 200 per year. Before then, in the 1980s and 1990s, the number of lots offered for sale annually had fluctuated in the region of 600 to 800. (It is interesting that the number of lots offered annually did not increase appreciably after the cessation of Sotheby’s London antiquities sales in 1997). At the same time, catalogues began including more information about provenance. By 2008, some information was included for nearly every lot offered for auction. That is not to say that the information provided was always useful for tracing back the ownership history and thus legitimacy of the lot offered for sale. Quite often, the ‘provenance’ might consist only of a name or a date. These minimal provenances might be interpreted as an honest attempt by Sotheby’s to meet customer concerns about provenance, or looked upon more cynically as an example of creative compliance, creating the appearance of meeting customer concerns while in reality carrying on business as usual. Either way, they do offer some reassurance to customers mildly worried about provenance, and maybe that is the point. But while such limited information might be of little use for investigating the legitimacy of a lot, it should not be dismissed out of hand. A false provenance is a fraudulent provenance, and fraud is a criminal offence. So any increase in provenance information does increase risk for an auction house, and is a step in the right direction towards a transparent, legitimate market. The nature of this provenance information will be explored further in a future post.

Auctions 2

The second graph shows that as the number of lots offered annually has declined, the mean price per lot sold has increased in real terms (all monetary values are standardized to 2005). Perhaps Sotheby’s has been been selling a smaller number of better quality objects. That would make sense. It might also mean though that the objects themselves were increasing in value through time as the market was increasing in value. That would also make sense. These two alternatives will be investigated further in a future post. (The 2007 price ‘spike’ is due to the sale on 7 June of a Late Hellenistic/Early Roman Imperial bronze statue of Artemis and the Stag for $28,600,000 (lot 41) and on 5 December of the Elamite ‘Guennol Lioness’ for $57,161,000. The 2010 price ‘spike’ is due to the sale on 7 December of a Roman Imperial bust of Antinous for $23,826,500).

Auctions 3

The third graph is particularly interesting. It examines the relationship between pre-sale price estimates provided by Sotheby’s in its catalogues and actual achieved prices. If the estimates were unbiased, it would be expected that achieved prices would distribute normally around estimate prices. This does seem to have been the case until about 2001, when the number of lots offered annually begins to decline. After 2002, a progressively higher number of lots achieve prices higher than the estimate. It is hard to believe that this is happening by chance, or that Sotheby’s specialists are consistently and accidentally undervaluing material. It seems more likely that estimates are being intentionally kept low to draw in potential buyers. ‘Come-hither’ estimates are an old-established auction practice to drum up custom. Once the potential buyers are bidding of course, they pay little attention to the estimate. But why would Sotheby’s want to attract more buyers?

Auctions 4

Traditionally, auction houses made their money from charging a seller’s commission, effectively a service charge levied on a seller. In 1975, in addition to the seller’s commission, both Sotheby’s and Christie’s began charging a buyer’s premium – a service charge levied on a buyer. From 1975 to 1992 the buyer’s premium remained steady at 10%. From 1993, however, Sotheby’s (and Christie’s) began to increase it, and to charge proportionately more for lower-priced lots. By 2013, Sotheby’s was charging 25% on prices up to $50,000, 20% on prices between $50,000 and $1 million, and 12% on prices in excess of $1 million. The fourth graph shows the effect of the increasing buyer’s premium from 1985 to 2013 on two notional lots priced respectively at $10,000 and $500,000. The auction houses have been forced to increase the buyer’s premium because in a competitive marketplace they are vulnerable to potential consignors ‘shopping around’. With auction houses keen to secure business, consignors can negotiate a deal to reduce or even dispense with seller’s commission. Auction house costs then have to be recovered from the buyers, who are less willing or able to negotiate.

Auctions 5

Graph number five shows the increasing revenue to Sotheby’s derived from the buyer’s premium. Notice the linear trend line increasing from about $350,000 in 1985 to about $4 million in 2013 (standardized to 2005 values).

Auctions 6

Finally, the sixth graph shows that the increasing value through time of lots being sold is real, and not just a function of the increasing buyer’s premium. (All sales data analyzed are from auction house results sheets, which incorporate the buyer’s premium into published prices).

This series of graphs strongly suggests that the changing configuration of auction sales through time is an outcome of a deliberate commercial strategy on Sotheby’s part to increase profitability by (1) reducing the number of lots offered, thereby decreasing associated handling costs; (2) drawing in more buyers with better provenanced lots and come-hither estimates, probably to increase prices by more competitive bidding; and (3) charging buyers progressively higher premiums.

This pattern is indicative of Sotheby’s sales strategy more generally, which since 2002 has been to focus more on the high end of the market [1]. Between 2002 and 2007, across the company, it halved the number of auction transactions and shed staff. Over that period, in a broader reflection of the antiquities sales data discussed here, the mean price per lot sold for all categories of object increased from $35,000 to $50,000. If the Art Newspaper is to be believed, however, we might be about to see this trend put into reverse.

Scholars (such as myself) who would like to use time series auction data as a proxy measure of illicit trade or regulatory impact would do well to take full account of the fact that auction houses are active commercial agents and it might be their commercial agency that is primarily structuring the data.

Reference

  1. Thompson, Don, 2008. The $12 million Stuffed Shark. New York: Palgrave, at 100.