Something about the Leonardo sale, surely its price tag, has provoked the oddest behavior among art market editors. Before the New York Times editor who handles art market coverage commissioned their reporter to write an inside account of the search fo the Leonardo buyer, the arts editor at the Financial Times penned a long piece about the Leonardo sale:

“This, some people felt, was just too mad. It was perhaps the first inkling that a market that is undeniably exciting and exhilarating might be on the edge of becoming seriously troubling.”

Here the Leonardo sale is also used as an opportunity to promote occasional FT contributor Georgina Adams’s new book, The Dark Side of the Boom. Like the heavy breathing about the art market becoming seriously troubling, the rest of the FT piece offers several scenarios of bad behavior ranging to from money-laundering to market manipulation but with little in the way of real-world examples.

Here’s the FT suggesting it is much easier to manipulate an artist’s market than most dealers or collectors would believe:

“Adam gives a word-of-mouth example, which works as follows . . .  You buy 10 works by a young artist for, say, $10,000. After a year or so of planting bits of hype here and there, you place one work in an auction. You and a co-conspirator then bid the work up and up, say to $100,000. Once the hammer has fallen at that level — because the chief way of determining prices in art is simply by previous achieved prices — you can (slowly, no rushing) sell off the other nine works at similarly inflated rates. At an enormous profit.”

The conjecture here is followed by the comment, “Again, not actually illegal.” But that surely isn’t true. Bidding on property you own is not legal. In the rare cases like divorce or the heirs to an estate bidding on works, the erstwhile or tangential owners have to disclose that they are bidding.

It is also not legal for bidders to coordinate their bids. That’s a bidding ring. Before the auction houses became the locus of all fears in the art market, there were real problems with dealers getting together and dividing up the lots in sales to reduce the competition and prices. That’s also blatantly illegal.

No one is suggesting buyers and sellers don’t try to put their thumb on the scale. But that doesn’t mean the act isn’t illegal. And if the FT has knowledge of such behavior, it might do the public a favor by publishing it.

$400m for a Leonardo da Vinci? Has the Art Wold Gone Mad? (Financial Times)