1 00:00:00,000 --> 00:00:05,540 In this episode of American Greed, Glafira Rosales is a novice to the New 2 00:00:05,540 --> 00:00:08,820 art scene, but she has all the right moves. 3 00:00:09,340 --> 00:00:14,920 She really played the relationships right. She says she holds the key to a 4 00:00:14,920 --> 00:00:18,160 treasure trove of never -before -seen masterpieces. 5 00:00:18,580 --> 00:00:23,560 Jackson Pollock with famous drip paintings, Mark Rothko, Robert 6 00:00:24,060 --> 00:00:26,980 These are paintings that go for millions of dollars each. 7 00:00:27,280 --> 00:00:30,560 A tale with enough mystique to draw millionaire buyers. 8 00:00:31,100 --> 00:00:38,060 Collectors are greedy for recognition and for artwork that lends 9 00:00:38,060 --> 00:00:39,060 them prestige. 10 00:00:39,080 --> 00:00:42,960 But before you open your wallet, you may want to look twice. 11 00:00:43,420 --> 00:00:48,880 Every aspect of the story behind those paintings was a red flag. 12 00:00:49,320 --> 00:00:53,180 It turns out skilled forgers know how to splash paint, too. 13 00:00:53,520 --> 00:01:00,000 Glafiero Rosales was able to take 63 paintings, get $33 million out of them, 14 00:01:00,000 --> 00:01:02,260 then the gallery stole them for $81 million. 15 00:01:03,220 --> 00:01:08,600 And Glafiero Rosales is a modern master in the art of the con. 16 00:01:09,340 --> 00:01:13,720 The experts believed it. Collectors bought it. It was auctioned off by big 17 00:01:13,720 --> 00:01:14,720 auction houses. 18 00:01:14,740 --> 00:01:16,780 I mean, this woman was sitting on top of the world. 19 00:01:35,530 --> 00:01:42,350 Teaming with gallery, museum, and hundreds of art dealers, 20 00:01:42,730 --> 00:01:47,230 New Yorkers work hard to keep their art capital booming. 21 00:01:49,850 --> 00:01:55,890 So in 2011, when one of New York's most venerable art galleries suddenly closes 22 00:01:55,890 --> 00:01:59,170 its doors, the art world is in shock. 23 00:02:00,770 --> 00:02:04,230 Knoedler and Company has been in business since 1846. 24 00:02:05,450 --> 00:02:10,130 And according to art historian Jack Flam, they've held a sterling pedigree. 25 00:02:11,150 --> 00:02:17,110 Knoedler and Company had one of the largest reputations of any art gallery 26 00:02:17,110 --> 00:02:21,590 the country and one of the largest reputations of any gallery in the world. 27 00:02:22,070 --> 00:02:28,210 Its legacy was built by supplying art to Gilded Age tycoons like Cornelius 28 00:02:28,210 --> 00:02:31,830 Vanderbilt, John D. Rockefeller, and J .P. Morgan. 29 00:02:32,470 --> 00:02:33,610 Over the years, it evolved. 30 00:02:33,870 --> 00:02:38,990 It handled old master paintings. It handled modern master paintings. And 31 00:02:38,990 --> 00:02:43,150 from around 1970 or so, it handled contemporary art. 32 00:02:43,510 --> 00:02:48,270 And in each one of those domains, it really handled blue -chip art. 33 00:02:49,570 --> 00:02:53,550 Knoedler's closing after 165 years is surprising. 34 00:02:54,110 --> 00:02:58,690 But the real kicker comes when rumors start to surface that Knoedler is 35 00:02:58,690 --> 00:03:01,170 embroiled in a massive art fraud. 36 00:03:02,350 --> 00:03:08,070 People who had bought paintings from Dozer were coming forward, having their 37 00:03:08,070 --> 00:03:09,330 paintings forensically tested. 38 00:03:09,690 --> 00:03:15,650 And soon, former federal prosecutor Jason Hernandez and U .S. investigators 39 00:03:15,650 --> 00:03:20,910 prove that a supplier provided the gallery with fakes sold for millions of 40 00:03:20,910 --> 00:03:23,810 dollars to some of America's wealthiest collectors. 41 00:03:24,430 --> 00:03:28,290 What those paintings represented would have been one of the greatest finds. 42 00:03:28,880 --> 00:03:31,940 of the Abstract American Expressionist School. 43 00:03:32,340 --> 00:03:35,980 And these are paintings that go for millions of dollars each. 44 00:03:36,480 --> 00:03:42,120 Knoedler, along with the gallery's director, Ann Friedman, say they've been 45 00:03:42,120 --> 00:03:48,560 fleeced, just like their clients, by a persuasive swindler named Glafira 46 00:03:48,560 --> 00:03:49,560 Rosales. 47 00:03:50,040 --> 00:03:56,260 Glafira Rosales is an incredibly sophisticated con artist. 48 00:03:56,940 --> 00:04:02,360 Maria Konnikova is the author of The Confidence Game, a book about 49 00:04:02,680 --> 00:04:07,780 She became intrigued with the story when the rumors started to erupt. 50 00:04:08,100 --> 00:04:14,700 What drew me to it wasn't just kind of the glamour of the art fraud 51 00:04:14,700 --> 00:04:19,600 world, but how it is that incredibly smart people sometimes believe things 52 00:04:19,600 --> 00:04:21,820 to an outsider seem incredibly dumb. 53 00:04:23,390 --> 00:04:28,090 According to court documents, Glafira Rosales and her boyfriend, Jose Carlos 54 00:04:28,090 --> 00:04:34,190 Burgantinos Diaz, arrived in the U .S. sometime in the early 1980s. 55 00:04:35,270 --> 00:04:38,650 We don't know that much about what her life was like in Mexico, which was her 56 00:04:38,650 --> 00:04:42,090 home country. We know that she worked in different jobs in the United States, 57 00:04:42,150 --> 00:04:43,170 some in the art field. 58 00:04:44,550 --> 00:04:50,070 First, they settled in Houston, where Glafira waits tables and Jose finds work 59 00:04:50,070 --> 00:04:51,110 as a kitchen helper. 60 00:04:52,330 --> 00:04:56,250 It takes them little over a year to earn enough money to move to the real city 61 00:04:56,250 --> 00:04:58,330 of dreams, New York. 62 00:05:00,530 --> 00:05:04,030 In 1986, Rosales is granted permanent residence. 63 00:05:04,230 --> 00:05:09,290 She and Jose Brigantinos have a daughter and buy a small house in the suburbs. 64 00:05:10,990 --> 00:05:15,790 Rosales even fulfills her childhood aspirations and opens a small gallery 65 00:05:15,790 --> 00:05:18,770 business called King's Fine Art. 66 00:05:20,240 --> 00:05:25,880 What Glafira Rosales told people was that she was from a family that loved 67 00:05:25,920 --> 00:05:31,180 that had a lot of people come to their house for art salons. And so from a very 68 00:05:31,180 --> 00:05:33,900 young age, she was fascinated by this world. 69 00:05:34,640 --> 00:05:40,600 Sometime later, Rosales meets a well -liked figure in the New York art scene 70 00:05:40,600 --> 00:05:43,080 happens to hold a position at Knoedler Gallery. 71 00:05:44,320 --> 00:05:47,320 He offers to set up a meeting with the gallery's director. 72 00:05:48,580 --> 00:05:49,620 Anne Friedman. 73 00:05:50,940 --> 00:05:53,840 Anne Friedman was pretty new as the director of Knoedler. 74 00:05:54,060 --> 00:05:59,980 She'd been very successful in her art career and someone who knows how to sell 75 00:05:59,980 --> 00:06:03,500 things to people, which is what you need in the art world. But now she really 76 00:06:03,500 --> 00:06:09,100 wanted to make a mark as the female director of this really prominent 77 00:06:10,220 --> 00:06:14,280 As luck would have it, Rosales is looking to make her mark too. 78 00:06:16,430 --> 00:06:22,010 So in 1995, when 40 -year -old Glafira Rosales breezes into Notre and Company 79 00:06:22,010 --> 00:06:27,510 with a canvas, she's the epitome of a well -dressed and cultivated art dealer. 80 00:06:29,370 --> 00:06:35,050 Lawyer Luke Nikas represented Anne Friedman in what's been called the art 81 00:06:35,050 --> 00:06:36,050 of the century. 82 00:06:36,370 --> 00:06:42,630 You have a woman who's unassuming. She's not slick. She doesn't have this well 83 00:06:42,630 --> 00:06:44,350 -planned story. 84 00:06:46,240 --> 00:06:52,340 a relationship with a man who inherited the painting from his father, and he 85 00:06:52,340 --> 00:06:55,800 lived in Mexico, and he just wanted to get rid of this collection. 86 00:06:57,140 --> 00:07:01,760 Friedman leads Rosales upstairs to a small drawing room. 87 00:07:02,320 --> 00:07:08,120 The painting's warm, peachy background with two ethereal clouds of color is 88 00:07:08,120 --> 00:07:13,000 immediately recognizable as the work of Mark Rothko, a leading artist of the 89 00:07:13,000 --> 00:07:14,560 abstract expressionist movement. 90 00:07:16,190 --> 00:07:21,110 Rothko, along with Jackson Pollock, Robert Motherwell, and a few select 91 00:07:21,350 --> 00:07:25,470 were leaders of the abstract expressionist movement that emerged in 92 00:07:25,470 --> 00:07:27,110 during the 1940s. 93 00:07:27,770 --> 00:07:32,710 That handful of artists are the artists that are the most valued, have the 94 00:07:32,710 --> 00:07:37,570 largest reputation, and in some cases also fetch the highest prices. 95 00:07:38,490 --> 00:07:44,070 People don't walk in off the street carrying a Rothko, and Anne Friedman 96 00:07:44,070 --> 00:07:45,039 it. 97 00:07:45,040 --> 00:07:49,360 When questioned, Rosales spins her tale of growing up in a prominent Catholic 98 00:07:49,360 --> 00:07:53,820 family in Mexico, surrounded by the creme de la creme of society. 99 00:07:55,320 --> 00:08:01,040 That's where Glafira came in contact with the heir to a secret art 100 00:08:01,040 --> 00:08:04,400 man she refers to only as Mr. X. 101 00:08:04,960 --> 00:08:09,440 To begin, she would try to sell the collection of a painter friend, someone 102 00:08:09,440 --> 00:08:12,140 whose confidentiality she wanted to respect. 103 00:08:12,800 --> 00:08:15,380 And so he became known as Mr. X. 104 00:08:17,660 --> 00:08:22,860 Mr. X's father had been a patron of the abstract expressionist art scene. 105 00:08:23,360 --> 00:08:28,060 He purchased artwork straight from the artist's studios, paying in cash. 106 00:08:28,500 --> 00:08:31,000 So the assets and taxes were never declared. 107 00:08:32,260 --> 00:08:37,799 According to Rosales, there's another family secret that needs to be kept. 108 00:08:38,650 --> 00:08:42,210 This man is married, not a family, and he was a closet homosexual. 109 00:08:42,630 --> 00:08:47,390 And in Mexico, supposedly, it was dangerous to be a homosexual at that 110 00:08:47,390 --> 00:08:52,370 so the man had died, and now his son was selling the pictures, but he wanted to 111 00:08:52,370 --> 00:08:53,770 do it as discreetly as possible. 112 00:08:54,350 --> 00:08:57,230 But there's a bonus, and it's alluring. 113 00:08:57,670 --> 00:09:00,730 This Rothko is just the tip of the iceberg. 114 00:09:01,530 --> 00:09:06,930 Her secretive client has a collection of previously unknown works by Robert 115 00:09:06,930 --> 00:09:12,370 Motherwell, William de Kooning, Jackson Pollock, and more. 116 00:09:14,290 --> 00:09:18,410 Pollock painting in 2015 went for $200 million. 117 00:09:18,910 --> 00:09:23,730 Only a few years before that, a Rothko went for $86 million. 118 00:09:24,190 --> 00:09:26,530 There are really big numbers involved. 119 00:09:26,970 --> 00:09:30,570 This collection has been hidden in storage for decades. 120 00:09:31,390 --> 00:09:35,290 But Rosales is not an expert in abstract expressionism. 121 00:09:35,870 --> 00:09:38,450 and her own gallery is too small. 122 00:09:40,370 --> 00:09:44,550 It doesn't seem to matter that few in the art world have heard of Rosales. 123 00:09:45,690 --> 00:09:51,950 This art is some of the most valued art of the 20th century. People pay tens of 124 00:09:51,950 --> 00:09:56,750 millions of dollars for it, and we haven't had anything new in it for a 125 00:09:57,510 --> 00:10:02,450 The gallery's new director, Anne Friedman, is dazzled by the prospect and 126 00:10:02,450 --> 00:10:03,450 profits. 127 00:10:04,970 --> 00:10:10,430 Up next on American Greed, Rosales' promise of a trove of masterworks is too 128 00:10:10,430 --> 00:10:11,450 good to pass up. 129 00:10:11,730 --> 00:10:17,570 Can you imagine being the one to discover this previously unknown 130 00:10:17,570 --> 00:10:19,130 of abstract expressionist art? 131 00:10:19,590 --> 00:10:24,310 You're not just making a name for yourself, but you are becoming the name. 132 00:10:37,450 --> 00:10:42,470 Up until now, Glafira Rosales has been circling the fringes of the New York art 133 00:10:42,470 --> 00:10:43,470 scene. 134 00:10:43,850 --> 00:10:49,250 She didn't know that much about art, to be perfectly honest, but she picked up a 135 00:10:49,250 --> 00:10:54,470 lot from the people around her. Her new contact, Anne Friedman, the director of 136 00:10:54,470 --> 00:10:58,970 Knoedler Gallery, has the power to launch her into the upper echelons. 137 00:11:00,110 --> 00:11:03,950 Glafira was delivering a great product. 138 00:11:04,680 --> 00:11:08,320 that she knew would catch the attention of the right people. 139 00:11:09,240 --> 00:11:13,740 Glafira's portrayal of the unassuming novice is picture perfect. 140 00:11:14,420 --> 00:11:20,220 I always think about the excitement that Anne Friedman felt, like the excitement 141 00:11:20,220 --> 00:11:22,920 you might feel finding dinosaur bones. 142 00:11:23,200 --> 00:11:26,140 It's this unearthed discovery. 143 00:11:26,700 --> 00:11:28,640 But a slight drawback emerges. 144 00:11:29,660 --> 00:11:34,180 The recorded history of ownership that proves its authenticity is called 145 00:11:34,180 --> 00:11:37,280 provenance, and this one is murky. 146 00:11:38,620 --> 00:11:41,940 Provenance is a really important concept in the art world. 147 00:11:42,420 --> 00:11:48,980 The story was that they were purchased by a family, a collector, directly from 148 00:11:48,980 --> 00:11:53,740 the artist, often purchased outside the back of the gallery in exchange for 149 00:11:53,740 --> 00:11:57,860 cash, and they had been kept in storage, basically, for decades. 150 00:11:58,730 --> 00:12:03,450 So if you believe that story, the lack of provenance actually makes sense. 151 00:12:04,210 --> 00:12:09,130 So over the next decade, Clefiro Rosales provides Knoedler with a few new 152 00:12:09,130 --> 00:12:12,190 paintings each year, all by heavy hitters. 153 00:12:12,690 --> 00:12:17,970 She sells additional works to art broker Julian Weissman, another New York art 154 00:12:17,970 --> 00:12:18,970 dealer. 155 00:12:20,570 --> 00:12:22,910 Her anonymous collector, Mr. 156 00:12:23,130 --> 00:12:27,370 X, turns out to be the gift horse that keeps on giving. 157 00:12:28,090 --> 00:12:34,290 The most high -profile artists, Jackson Pollock, Rothko's, Motherwell's, I mean, 158 00:12:34,310 --> 00:12:35,370 you name it, it was there. 159 00:12:35,750 --> 00:12:40,730 And discretion is fundamental to the rare art market, where collectors are 160 00:12:40,730 --> 00:12:42,370 tight -lipped about selling. 161 00:12:43,310 --> 00:12:46,830 Secrecy is highly prized in the art world. When you're a buyer, you're not 162 00:12:46,830 --> 00:12:49,130 entitled, for example, to know who the seller is. 163 00:12:49,390 --> 00:12:53,430 Or if a broker comes in with a piece of art, they don't have to necessarily 164 00:12:53,430 --> 00:12:55,350 disclose who their client is. 165 00:12:56,790 --> 00:13:02,270 Still... Rosales' secret collector poses a vexing setback when it comes to 166 00:13:02,270 --> 00:13:03,330 negotiating prices. 167 00:13:04,290 --> 00:13:10,430 The more provenance you have, the more detail you have, the more likely the 168 00:13:10,430 --> 00:13:14,870 is going to sell for a higher price because the backup is there. 169 00:13:15,130 --> 00:13:21,110 When Anne Friedman pushes her for more details, Rosales names David Herbert, a 170 00:13:21,110 --> 00:13:23,950 deceased New York art dealer, as the go -between. 171 00:13:24,670 --> 00:13:29,610 She hears the name David Herbert as someone who has been associated with 172 00:13:29,610 --> 00:13:34,710 artists who was also part of the gay community at the time. And so all of a 173 00:13:34,710 --> 00:13:38,130 sudden, David Herbert can be someone who's connected to Mr. 174 00:13:38,330 --> 00:13:39,330 X. 175 00:13:39,750 --> 00:13:45,230 To help shore up the murky provenance, Knoedler shows the works to art experts 176 00:13:45,230 --> 00:13:46,810 to get their opinions. 177 00:13:47,550 --> 00:13:51,230 Dan Friedman and other galleries showed these paintings, including the very 178 00:13:51,230 --> 00:13:55,490 first one that came in the door to some of the finest experts in the world on 179 00:13:55,490 --> 00:13:56,409 Mark Rothko. 180 00:13:56,410 --> 00:14:00,770 They saw these paintings, several of them, and said these are convincing. 181 00:14:01,510 --> 00:14:06,270 Art historian Jack Flam recalls viewing a painting at Knoedler by Robert 182 00:14:06,270 --> 00:14:07,270 Motherwell. 183 00:14:07,750 --> 00:14:12,930 She showed me a Motherwell elegy that was on the floor in her office, and she 184 00:14:12,930 --> 00:14:14,910 said that she had just got it. 185 00:14:15,400 --> 00:14:19,340 Flam had been close friends with Motherwell until his death in 1991. 186 00:14:19,960 --> 00:14:25,420 The work is credited to Motherwell's Spanish elegy series, and it catches him 187 00:14:25,420 --> 00:14:32,180 surprise. In the elegies which became his signature paintings from 1948 to 188 00:14:32,180 --> 00:14:36,980 when he died in 1991, he painted over 170 elegy paintings. 189 00:14:37,520 --> 00:14:42,020 They're also the paintings of his that fetch the highest price on the market. 190 00:14:43,120 --> 00:14:45,860 Friedman never mentions the name Glafira Rosales. 191 00:14:46,540 --> 00:14:50,820 Instead, the works are generally referred to as the Herbert Collection. 192 00:14:52,120 --> 00:14:57,340 And she asked me if I remember correctly, at that time, whether I'd 193 00:14:57,340 --> 00:14:59,220 of someone named David Herbert. 194 00:14:59,940 --> 00:15:03,980 And I said, no, I had not. And she said he was a well -known art dealer. 195 00:15:04,460 --> 00:15:07,660 And, you know, at the time, I thought, well, you know, that's nice. 196 00:15:08,320 --> 00:15:12,720 Jack Flam doesn't think of questioning Knoedler's rock -solid reputation. 197 00:15:13,400 --> 00:15:15,840 And so, you know, you're in Knoedler, you don't think twice. 198 00:15:16,240 --> 00:15:21,700 And of course there's that added boon for buyers who are willing to accept the 199 00:15:21,700 --> 00:15:22,720 lack of documentation. 200 00:15:23,960 --> 00:15:28,160 These are artists that are really, really difficult to get and that command 201 00:15:28,160 --> 00:15:32,900 incredibly high prices. Now imagine you can get those works and at a bargain 202 00:15:32,900 --> 00:15:36,890 price. So not only are you a brilliant art collector, you're also a pretty 203 00:15:36,890 --> 00:15:37,890 genius businessman. 204 00:15:38,250 --> 00:15:41,470 Some collectors are more wary than others. 205 00:15:43,590 --> 00:15:49,050 Rosales sells this purported Jackson Pollock to Knoedler for $750 ,000. 206 00:15:51,030 --> 00:15:57,030 In 2001, Knoedler turns around and sells it to Jack Levy, a co -chairman at 207 00:15:57,030 --> 00:15:59,090 Goldman Sachs, for $2 million. 208 00:15:59,870 --> 00:16:01,250 With one caveat. 209 00:16:02,330 --> 00:16:06,830 The sale hinges on Knoedler obtaining a review verifying its authenticity from 210 00:16:06,830 --> 00:16:12,250 the International Foundation for Art Research, otherwise known as IFAR. 211 00:16:12,930 --> 00:16:18,630 It had a panel of experts put together to give their views about the painting, 212 00:16:18,790 --> 00:16:20,030 and they wrote a report. 213 00:16:20,370 --> 00:16:25,590 But IFAR won't positively attribute the work to Pollock and deems the provenance 214 00:16:25,590 --> 00:16:26,590 questionable. 215 00:16:27,630 --> 00:16:31,810 Knoedler discreetly cancels Levy's sale and refunds his $2 million. 216 00:16:32,230 --> 00:16:35,130 But Knoedler's mission is to sell. 217 00:16:35,470 --> 00:16:38,710 These works were really exciting. 218 00:16:39,150 --> 00:16:44,970 And some really smart, prominent people have bought these works for their 219 00:16:44,970 --> 00:16:50,910 collections. A California collector pays $3 .1 million for a painting said to be 220 00:16:50,910 --> 00:16:52,010 by Jackson Pollock. 221 00:16:52,390 --> 00:16:55,710 John Howard, who runs a billion -dollar equity firm... 222 00:16:56,080 --> 00:16:58,980 purchases a William de Kooning for $4 million. 223 00:17:00,620 --> 00:17:07,060 In 2004, Domenico del Sol, a chairman of Tom Ford and Sotheby's, 224 00:17:07,180 --> 00:17:11,119 buys a purported Rothko for $8 .3 million. 225 00:17:13,960 --> 00:17:18,760 Next, while Rosales and her gallery clients are celebrating their lucrative 226 00:17:18,760 --> 00:17:21,000 alliance and million -dollar sales... 227 00:17:21,900 --> 00:17:25,460 Eyes are on another painting that's popped up on the market. 228 00:17:26,020 --> 00:17:30,460 I had certain kind of in my gut misgivings about it. 229 00:17:42,860 --> 00:17:48,840 By 2006, the market for abstract expressionist art is enjoying a 230 00:17:50,570 --> 00:17:55,130 Thanks in part to Glafira Rosales' collection of never -before -seen 231 00:17:55,130 --> 00:17:56,130 masterpieces. 232 00:17:56,890 --> 00:18:03,290 For works by major artists to come up on the market, it's extremely rare. But 233 00:18:03,290 --> 00:18:09,210 for multiple works by the same artist to come out of the same collection is 234 00:18:09,210 --> 00:18:11,490 very, very unusual. 235 00:18:12,610 --> 00:18:17,290 The alliance between the little -known Rosales and the prestigious gallery like 236 00:18:17,290 --> 00:18:19,870 Knoedler might seem strange, too. 237 00:18:20,910 --> 00:18:23,110 But it appears to be kismet. 238 00:18:24,570 --> 00:18:28,570 Rosales just built slowly this relationship of trust. 239 00:18:28,950 --> 00:18:33,750 She would talk to Anne about her daughter's musical talent. 240 00:18:33,990 --> 00:18:38,570 She would talk with her every single birthday. This is the sort of thing that 241 00:18:38,570 --> 00:18:42,810 really made Anne Friedman trust Glafira Rosales. 242 00:18:43,230 --> 00:18:48,590 While Rosales is the supplier, Anne Friedman is the face that makes the 243 00:18:50,670 --> 00:18:54,950 Meredith Savona was formerly with the FBI's Art Crimes Unit. 244 00:18:55,190 --> 00:18:58,390 She offers an analogy of Knoedler's prestige. 245 00:18:59,190 --> 00:19:05,350 If I buy a diamond from Tiffany, I'm not going to then take it to find out if 246 00:19:05,350 --> 00:19:07,330 it's authentic. I bought it from Tiffany. 247 00:19:07,930 --> 00:19:12,870 If I buy a painting from Knoedler Gallery, I have to assume it's an 248 00:19:12,870 --> 00:19:15,810 painting. It had that same kind of reputation. 249 00:19:17,010 --> 00:19:18,830 Often there'll be experts who... 250 00:19:19,130 --> 00:19:21,850 in their heart of hearts, think that a painting is fake, but they'll never 251 00:19:21,850 --> 00:19:26,750 express it. And part of that is due to the politeness of the art business, but 252 00:19:26,750 --> 00:19:29,170 really it's also driven by the fear of being sued. 253 00:19:30,070 --> 00:19:32,070 So in January 2007, 254 00:19:32,890 --> 00:19:38,010 art historian Jack Flam is at odds when a Robert Motherwell painting popped up 255 00:19:38,010 --> 00:19:41,210 at Julian Weissman's, another New York art broker. 256 00:19:41,650 --> 00:19:45,270 We had no record of it, and this is always very exciting to see a new 257 00:19:46,060 --> 00:19:51,000 The Spanish elegy reminds him of the mother well he saw in Friedman's office 258 00:19:51,000 --> 00:19:52,000 before. 259 00:19:52,160 --> 00:19:54,720 But there's something strange in the details. 260 00:19:55,380 --> 00:20:01,780 I had certain kind of in my gut misgivings about it and was by then 50 261 00:20:01,780 --> 00:20:02,780 or more. 262 00:20:02,980 --> 00:20:07,080 And although it was warped, the front of it, the paint was not warped or 263 00:20:07,080 --> 00:20:09,140 cracked, which looked odd. 264 00:20:10,480 --> 00:20:14,140 He holds his tongue despite his misgivings. 265 00:20:14,650 --> 00:20:17,690 You're always advised not to police the market. It's not your job. 266 00:20:18,150 --> 00:20:21,130 But nonetheless, you want to protect your artist's legacy. 267 00:20:22,130 --> 00:20:28,490 As it happens, Flam is also president of the Daedalus Foundation, founded by 268 00:20:28,490 --> 00:20:29,490 Robert Motherwell. 269 00:20:29,870 --> 00:20:34,470 Daedalus is in the midst of compiling a catalog raisonne on Motherwell. 270 00:20:34,910 --> 00:20:41,770 A catalog raisonne is a gathering of all the work by an artist, by... 271 00:20:42,490 --> 00:20:48,190 common usage, it becomes the standard for establishing what are the authentic 272 00:20:48,190 --> 00:20:52,310 works by the artist and what is their authentic history. 273 00:20:52,670 --> 00:20:57,110 During the process, researchers track down every known work by Motherwell. 274 00:20:57,510 --> 00:21:01,670 They enter it into their database and assign it an ID number. 275 00:21:02,470 --> 00:21:05,630 Can you see the difference in the late 50s? 276 00:21:06,070 --> 00:21:09,250 They still kept that sense of spontaneity. 277 00:21:09,960 --> 00:21:14,320 While studying seven paintings attributed to Motherwell's Spanish elegy 278 00:21:14,480 --> 00:21:16,760 they notice a striking anomaly. 279 00:21:17,420 --> 00:21:22,700 My team showed me digital images of the fronts and the backs of the Spanish 280 00:21:22,700 --> 00:21:28,620 elegies, and there were six from 1953, and this new one was 1955. 281 00:21:29,740 --> 00:21:36,080 When we saw the back of this one, we saw that it was signed very much 282 00:21:36,080 --> 00:21:38,300 the way the others. 283 00:21:39,200 --> 00:21:45,180 were, for example, Robert Motherwell and then underneath it the date 1955. 284 00:21:45,860 --> 00:21:50,280 And then on a painting that was supposed to have been done three years earlier 285 00:21:50,280 --> 00:21:56,860 in 1953, once again, Spanish elegy in quotation marks and full caps on the 286 00:21:56,860 --> 00:22:00,680 top. It was exactly the same printing and the date in the same place. 287 00:22:00,980 --> 00:22:04,120 But Motherwell's signature is known to be inconsistent. 288 00:22:05,120 --> 00:22:09,600 Motherwell in particular signed pictures in different ways in different months. 289 00:22:09,820 --> 00:22:11,340 So this was a real tell. 290 00:22:11,560 --> 00:22:13,520 This really made us suspicious. 291 00:22:14,180 --> 00:22:18,780 Another tell has to do with the two words Spanish elegy. 292 00:22:19,040 --> 00:22:23,300 Now this is something that Motherwell himself often said, like Spanish elegy 293 00:22:23,300 --> 00:22:28,520 paintings, or that's a Spanish elegy. But he did not put that on the backs of 294 00:22:28,520 --> 00:22:32,440 the paintings. And this is especially significant because... 295 00:22:33,150 --> 00:22:38,610 Those paintings that we're beginning to suspect were fakes had the title Spanish 296 00:22:38,610 --> 00:22:39,810 Elegy on them. 297 00:22:40,030 --> 00:22:45,430 Another tell, and perhaps the most damning in Flam's mind, has to do with 298 00:22:45,430 --> 00:22:49,890 technique. If you look at the crispness and the intensity with which the real 299 00:22:49,890 --> 00:22:54,710 paint is painted, and you look at this, which is all kind of muffled and soft 300 00:22:54,710 --> 00:23:01,510 around the edges, Motherwell was very proud of and very careful about is the 301 00:23:01,510 --> 00:23:02,510 in which... 302 00:23:02,920 --> 00:23:09,540 He used variations of edge. So you get very sharp edges, very soft 303 00:23:09,540 --> 00:23:13,280 edges. So that kind of variation was something very important to him. 304 00:23:13,640 --> 00:23:17,040 But something that the forger misses entirely. 305 00:23:17,560 --> 00:23:22,240 Their findings leave no doubt to Flam that the elegies are fake. 306 00:23:22,620 --> 00:23:27,420 For Daedalus, it just begs the question, where did these pictures come from? 307 00:23:28,300 --> 00:23:32,120 And going through the database, we found that none of these pictures had a 308 00:23:32,120 --> 00:23:34,120 provenance that went back before 1999. 309 00:23:36,180 --> 00:23:40,120 First owner for four of them, Anne Friedman Knoedler Gallery. 310 00:23:42,120 --> 00:23:43,940 Other three, Julian Weissman. 311 00:23:44,180 --> 00:23:46,460 This is more than bizarre. 312 00:23:47,620 --> 00:23:49,580 You've got seven paintings. 313 00:23:50,760 --> 00:23:54,800 Four of them come from one gallery, and they're almost like one from one gallery 314 00:23:54,800 --> 00:23:56,040 the next year, one from the other. 315 00:23:56,650 --> 00:23:58,170 one from one, one from the other. 316 00:24:01,290 --> 00:24:07,290 Up next, more questions arise about Rosales' elusive collector, Mr. X. 317 00:24:08,350 --> 00:24:11,730 I come to suspect that Mr. X did not exist. 318 00:24:13,670 --> 00:24:19,130 Every aspect of the story behind those paintings was a red flag. 319 00:24:31,690 --> 00:24:34,150 The art market can be secretive. 320 00:24:35,110 --> 00:24:40,010 Sometimes super -rich buyers and sellers opt for discretion. 321 00:24:41,350 --> 00:24:43,890 Sellers like Glafira Rosales. 322 00:24:45,050 --> 00:24:47,910 Glafira wasn't ostentatious. 323 00:24:48,730 --> 00:24:55,410 She didn't have flashy clothes. She didn't have an 324 00:24:55,410 --> 00:24:59,310 extraordinary mansion that $30 million can buy. 325 00:24:59,570 --> 00:25:01,130 She had a nice home. 326 00:25:01,520 --> 00:25:05,480 On Long Island, she had a nice, authentic collection of art. 327 00:25:06,080 --> 00:25:09,460 And she lived a good life. 328 00:25:10,040 --> 00:25:15,980 But brokering art for her anonymous client, Mr. X, has put plenty of money 329 00:25:15,980 --> 00:25:16,980 her pocket. 330 00:25:17,400 --> 00:25:22,440 The most lucrative sale comes in November 2007 when hedge fund 331 00:25:22,440 --> 00:25:27,580 Pierre Lagrange buys a Jackson Pollock painting from Knoedler for $17 million. 332 00:25:28,860 --> 00:25:34,140 So over the course of 15 years, Golfiero Rosales was able to take 63 paintings, 333 00:25:34,320 --> 00:25:39,920 get $33 million out of them, and then the gallery sold them for $81 million. 334 00:25:41,360 --> 00:25:46,400 At this point, Jack Flam and researchers from the Daedalus Foundation appear to 335 00:25:46,400 --> 00:25:47,640 be the only skeptics. 336 00:25:48,000 --> 00:25:52,540 In fact, Flam finds the story of Mr. X astounding. 337 00:25:53,440 --> 00:25:56,780 And, you know, this sounds like a classic, you know, these paintings are 338 00:25:56,780 --> 00:26:01,980 to my aunt by her lover, and, you know, nobody was supposed to know about the 339 00:26:01,980 --> 00:26:05,260 lover, and now the lover's dead and she wants to sell the paintings. I mean, 340 00:26:05,260 --> 00:26:08,920 this is a classic story for confronting fake paintings. 341 00:26:09,940 --> 00:26:14,420 He lays out his suspicions to Ann Friedman, the director of Knoedler 342 00:26:15,220 --> 00:26:18,880 My expectation was that she would be grateful. 343 00:26:20,350 --> 00:26:26,430 Because we're alerting her to a possible fraud, and therefore she could take 344 00:26:26,430 --> 00:26:29,910 action. She could go back to the person she was getting them from and say, hey, 345 00:26:29,970 --> 00:26:30,869 what's the story? 346 00:26:30,870 --> 00:26:33,230 And instead she started arguing with us. 347 00:26:33,490 --> 00:26:38,130 While Anne Friedman declined to speak with American Greed, lawyer Luke Nickus 348 00:26:38,130 --> 00:26:40,370 defended her in later civil cases. 349 00:26:40,770 --> 00:26:42,990 Anne Friedman believed in these works. 350 00:26:43,330 --> 00:26:44,950 She spent the... 351 00:26:45,240 --> 00:26:51,360 better part of 14 years doing diligence in them, hiring experts to research 352 00:26:51,360 --> 00:26:55,180 them, and she really believed in them. 353 00:26:55,440 --> 00:27:00,880 So this was very disturbing. We had no doubt that the paintings were wrong, 354 00:27:00,880 --> 00:27:02,960 Anne was being hoodwinked by someone. 355 00:27:03,680 --> 00:27:09,040 In December 2008, Daedalus refuses to enter the newly discovered works in 356 00:27:09,040 --> 00:27:10,060 catalog raisonne. 357 00:27:10,880 --> 00:27:15,340 The vast majority of people who own works by an artist, they want it to be 358 00:27:15,340 --> 00:27:19,720 the catalog resume because this is a sign of authenticity. 359 00:27:20,420 --> 00:27:25,540 To mitigate their concerns, Knoedler agrees to submit the Spanish elegy to 360 00:27:25,540 --> 00:27:26,540 forensic testing. 361 00:27:26,960 --> 00:27:32,980 They run an arsenal of tests, including infrared spectroscopy, to help determine 362 00:27:32,980 --> 00:27:36,640 whether or not certain materials are present in a painting. 363 00:27:37,440 --> 00:27:38,460 The results? 364 00:27:40,730 --> 00:27:44,830 Paint that was found that didn't exist at the time of some of these artists. 365 00:27:45,510 --> 00:27:49,950 In particular, the presence of acrylic polymer emulsion paints. 366 00:27:50,310 --> 00:27:55,590 But Robert Motherwell did not begin using this kind of paint until the 367 00:27:55,890 --> 00:28:01,090 Based on the findings, the Daedalus Foundation refuses to stand by any of 368 00:28:01,090 --> 00:28:02,430 seven Motherwell elegies. 369 00:28:02,790 --> 00:28:08,270 As rumors ripple to the art scene, more collectors are eyeing their paintings. 370 00:28:09,380 --> 00:28:14,260 Everyone who knew this body of work, whether they thought the paintings were 371 00:28:14,260 --> 00:28:19,160 real or whether they thought the paintings were fakes, all said the same 372 00:28:19,340 --> 00:28:21,960 If one of them is fake, they're all fake. 373 00:28:22,640 --> 00:28:26,520 Flam makes the decision to quietly contact the FBI. 374 00:28:27,420 --> 00:28:33,340 Jack Flam is probably the hero of this story because the FBI was involved early 375 00:28:33,340 --> 00:28:37,780 on. But he kept it very quiet, and other people who knew what was going on kept 376 00:28:37,780 --> 00:28:41,740 it very quiet, which is the way that we can do our investigation. 377 00:28:43,180 --> 00:28:46,720 Next on American Greed, what will it take to stop a fraud? 378 00:28:47,200 --> 00:28:51,520 From the time the painting was created to where it walked through Knoller, 379 00:28:51,520 --> 00:28:52,520 was nothing but gap. 380 00:28:52,640 --> 00:28:53,860 There was no paperwork. 381 00:28:54,220 --> 00:28:55,340 There was no trail. 382 00:28:55,560 --> 00:28:56,700 There was no record. 383 00:29:04,810 --> 00:29:11,590 By 2009, Glafira Rosales is enjoying a long and lucrative run as the supplier 384 00:29:11,590 --> 00:29:13,030 coveted masterpieces. 385 00:29:13,550 --> 00:29:19,650 The market got hotter and hotter, and it was something that Glafira Rosales was 386 00:29:19,650 --> 00:29:20,750 able to take advantage of. 387 00:29:21,090 --> 00:29:24,290 She's the biggest blessing the art market has seen in decades. 388 00:29:24,690 --> 00:29:27,350 But the gravy train is about to derail. 389 00:29:27,870 --> 00:29:30,750 So it turned out that I was not the only person. 390 00:29:31,450 --> 00:29:35,550 who thought the paintings that were coming through Knoedler and Julian 391 00:29:35,550 --> 00:29:36,550 were fake. 392 00:29:36,630 --> 00:29:38,950 But people weren't talking to each other. 393 00:29:39,310 --> 00:29:44,070 British billionaire Pierre Lagrange, who bought a $17 million Jackson Pollock 394 00:29:44,070 --> 00:29:47,290 from Knoedler in 2007, is ready to let it go. 395 00:29:48,190 --> 00:29:50,650 But suddenly he's having trouble unloading it. 396 00:29:51,930 --> 00:29:55,910 He tried to sell it at one of the big auction houses, and they refused to sell 397 00:29:55,910 --> 00:30:01,820 it. And because of Jack Flam's tip, The FBI Art Crimes Unit is now curious about 398 00:30:01,820 --> 00:30:06,080 the slew of paintings attributed to the same elusive provenance. 399 00:30:06,540 --> 00:30:11,820 We had to go down every avenue to find the negative, to find that Mr. X did not 400 00:30:11,820 --> 00:30:14,420 exist, to find that the client did not exist. 401 00:30:15,380 --> 00:30:20,700 When former Assistant U .S. Attorney Jason Hernandez joins the case, his 402 00:30:20,700 --> 00:30:22,040 objective is clear. 403 00:30:22,560 --> 00:30:26,940 To get a criminal prosecution for fraud, you have to prove beyond a reasonable 404 00:30:26,940 --> 00:30:31,220 doubt that someone intended to commit a fraud, and that's the highest burden in 405 00:30:31,220 --> 00:30:32,220 our law. 406 00:30:32,260 --> 00:30:37,100 Rosales may be the likeliest suspect, but it's not that simple. 407 00:30:38,000 --> 00:30:42,700 You want to try and figure out some link to an artist, to a manufacturing 408 00:30:42,700 --> 00:30:47,920 facility, to purchases that are suspicious, anything that would give us 409 00:30:47,920 --> 00:30:51,140 as to who's making the paintings and where they're coming from. 410 00:30:51,630 --> 00:30:53,510 But every lead fizzles. 411 00:30:54,170 --> 00:30:58,770 He decides to dig at it from another angle, the Internal Revenue Service. 412 00:30:59,510 --> 00:31:03,930 I had never worked with the IRS before, and I thought, oh, man, now this is 413 00:31:03,930 --> 00:31:04,930 going to take forever. 414 00:31:06,070 --> 00:31:07,230 And it didn't. 415 00:31:07,910 --> 00:31:13,170 Enter IRS Special Agent Eric Yonke to follow the money. 416 00:31:14,170 --> 00:31:17,390 It's hard to walk away from bank statement while your transfer's in 417 00:31:18,310 --> 00:31:24,790 Between 2006 and 2011, Rosales asked the galleries to deposit her payments to 418 00:31:24,790 --> 00:31:29,630 two Spanish bank accounts, BBVA and Caja Madrid. 419 00:31:30,530 --> 00:31:34,930 During the three years of the investigation that we took into 420 00:31:34,930 --> 00:31:39,190 received over $14 million from prominent New York City galleries for the works 421 00:31:39,190 --> 00:31:40,650 of art that she was selling. 422 00:31:41,050 --> 00:31:46,590 And central to Rosales' story is that she's an art broker for her Spanish 423 00:31:46,590 --> 00:31:49,030 client. If that's true... 424 00:31:49,450 --> 00:31:55,030 She would pay 90 % to her mysterious client and collect a standard fee of 425 00:31:55,030 --> 00:31:59,550 She says she's representing somebody. Well, it's obviously got to go back to 426 00:31:59,550 --> 00:32:00,550 somebody. 427 00:32:01,350 --> 00:32:07,550 And if it's not going back to the person she claims to be representing, then 428 00:32:07,550 --> 00:32:09,150 there is nobody she's representing. 429 00:32:11,850 --> 00:32:16,070 The biggest red flag was her sending the money directly overseas after selling 430 00:32:16,070 --> 00:32:17,070 the pieces of artwork. 431 00:32:17,630 --> 00:32:20,250 The nail in the coffin was that she wasn't paying any clients. 432 00:32:20,810 --> 00:32:26,350 In particular, Glafira Rosales' mysterious client, Mr. X. 433 00:32:27,110 --> 00:32:32,390 What that told us was that her story was false. There is no family in Europe 434 00:32:32,390 --> 00:32:33,850 that owns these paintings. 435 00:32:34,110 --> 00:32:39,110 These are paintings that are almost certainly fake, and that she's pulling 436 00:32:39,110 --> 00:32:41,770 scam and keeping the money in foreign bank accounts. 437 00:32:42,630 --> 00:32:45,530 The bank accounts linked to two new suspects. 438 00:32:46,380 --> 00:32:51,840 Her longtime boyfriend, Carlos Burgantinos Diaz, and his brother, 439 00:32:53,700 --> 00:32:58,800 While it strengthens the fraud case, it also breaks another case wide open. 440 00:32:59,460 --> 00:33:00,620 Tax evasion. 441 00:33:01,840 --> 00:33:07,580 During 2006 -2008, we saw her receive a ton of money, and the majority of it 442 00:33:07,580 --> 00:33:08,580 sent overseas. 443 00:33:08,800 --> 00:33:11,980 So we were able to look at that and see how much she reported on her tax 444 00:33:11,980 --> 00:33:14,160 returns. She was reporting... 445 00:33:14,440 --> 00:33:17,880 just over $2 million received for those three years, when, in fact, she was 446 00:33:17,880 --> 00:33:19,080 receiving over $14 million. 447 00:33:19,920 --> 00:33:22,040 She was reporting peanuts in her tax returns. 448 00:33:22,340 --> 00:33:26,200 So from there, she's understating her income, lying on her tax returns, and 449 00:33:26,200 --> 00:33:28,300 she's also hiding the Spanish bank accounts overseas. 450 00:33:28,840 --> 00:33:30,300 In May 2013, 451 00:33:31,160 --> 00:33:35,860 Glafira Rosales is charged and held for tax fraud and money laundering. 452 00:33:36,360 --> 00:33:41,320 If convicted on all counts, she's looking at up to 34 years in prison. 453 00:33:42,090 --> 00:33:47,250 In the ensuing weeks, Pierre Legrand sends Knoedler an expert's report that 454 00:33:47,250 --> 00:33:52,470 Jackson Pollock painting he purchased for $17 million is yet another fake. 455 00:33:52,930 --> 00:33:57,550 One day later, the long -esteemed gallery closes its doors. 456 00:33:58,510 --> 00:34:03,590 Over 60 of these paintings spanning multiple artists, but it was really only 457 00:34:03,590 --> 00:34:08,530 toward the end of the scene that the full picture was really brought to bear. 458 00:34:09,770 --> 00:34:10,770 Up next. 459 00:34:11,389 --> 00:34:16,310 Glafiero Rosales reveals the shocking source behind the scheme that duped the 460 00:34:16,310 --> 00:34:17,710 art world for millions. 461 00:34:18,190 --> 00:34:22,190 I was very surprised when I found it was one man who had done all of those 462 00:34:22,190 --> 00:34:23,190 paintings. 463 00:34:37,870 --> 00:34:39,389 In 2013, 464 00:34:40,300 --> 00:34:45,620 Glafiro Rosales' astonishing 15 -year art scam appears to be over. 465 00:34:46,780 --> 00:34:52,159 She got so enamored of what she was doing and thought that she was so good 466 00:34:52,159 --> 00:34:54,560 that she would absolutely never get caught. 467 00:34:54,920 --> 00:35:00,140 But now, if Rosales is convicted on tax and wire fraud charges, she faces more 468 00:35:00,140 --> 00:35:02,120 than three decades behind bars. 469 00:35:03,800 --> 00:35:09,380 The magistrate judge denied her bail, and her being detained, held without 470 00:35:10,110 --> 00:35:13,870 probably caused her to think real hard about what her options were in this 471 00:35:14,590 --> 00:35:20,010 Clefero Rosales admits to passing off fake paintings as real with the help of 472 00:35:20,010 --> 00:35:24,230 her boyfriend, Jose Carlos Bergantinos Diaz, and his brother, Jesus. 473 00:35:24,910 --> 00:35:28,490 One of the things that makes the fraud like this successful is a good false 474 00:35:28,490 --> 00:35:33,310 provenance. And the Bergantinos Diaz brothers were adept at that. They would 475 00:35:33,310 --> 00:35:38,870 conduct research in the historical record, in books, anything they could 476 00:35:38,870 --> 00:35:41,850 that... When the paintings were passed off, it was believable. 477 00:35:42,490 --> 00:35:48,030 Glafira also names the artist Forger, an elderly Chinese immigrant in Queens 478 00:35:48,030 --> 00:35:49,910 named Pai Shan Qian. 479 00:35:50,390 --> 00:35:57,030 For 15 years, Pai Shan Qian became Jackson Pollock, Robert Motherwell, 480 00:35:57,270 --> 00:36:00,690 Franz Klein, Mark Rothko, and any number of artists. 481 00:36:01,710 --> 00:36:06,790 In the 1970s, Cheon used to paint portraits of Chairman Mao for schools 482 00:36:06,790 --> 00:36:09,510 factories before immigrating to the United States. 483 00:36:10,430 --> 00:36:15,450 He didn't have much luck as a serious artist in the U .S. and resorted to 484 00:36:15,450 --> 00:36:18,370 hustling portraits on the sidewalks of Manhattan. 485 00:36:19,430 --> 00:36:25,650 This is someone who Jose Burgantinos Diaz and Glafiero Rosales found just 486 00:36:25,650 --> 00:36:29,110 painting in New York City one day, and they challenged him. 487 00:36:29,610 --> 00:36:33,690 They explained to Qian how buyers are simply looking for works in the manner 488 00:36:33,690 --> 00:36:35,330 abstract expressionist masters. 489 00:36:35,990 --> 00:36:41,430 They asked him to paint in the style of Rothko or Pollock to see if he could do 490 00:36:41,430 --> 00:36:44,230 it. And not only could he do it, he could do it well. 491 00:36:45,050 --> 00:36:50,850 For the next 15 years in his modest studio in Queens, Pei -Shun Qian creates 492 00:36:50,850 --> 00:36:52,590 dozens of lookalikes. 493 00:36:54,330 --> 00:36:58,510 This is a painting created by Pei -Shun Qian, the forger. 494 00:36:58,940 --> 00:37:03,060 It's a painting that's supposed to look like Mark Rothko. It had the right color 495 00:37:03,060 --> 00:37:08,740 scheme. It had the right style for Mark Rothko. You can see if you get close, 496 00:37:08,980 --> 00:37:13,160 you can see some of the brush strokes, all consistent with the way Rothko 497 00:37:13,160 --> 00:37:16,980 painted. But it takes more than technique to fool savvy dealers. 498 00:37:17,440 --> 00:37:22,460 According to Rosales, that's where Jose stepped in to add his expertise. 499 00:37:23,790 --> 00:37:27,990 You need an older canvas for a painting that's supposed to be 60 years old. 500 00:37:28,210 --> 00:37:32,290 So they would go to flea markets and look for paintings that were the right 501 00:37:32,290 --> 00:37:34,150 and frames that were of the right age. 502 00:37:34,770 --> 00:37:40,090 Once Pai Shun finished a painting, Burgantino's added another touch of age. 503 00:37:40,650 --> 00:37:45,130 He would do things like empty the vacuum cleaner dustbin into the painting so 504 00:37:45,130 --> 00:37:49,110 that dust and dirt would get into the crevices of the painting as you would 505 00:37:49,110 --> 00:37:51,070 expect to find in an older painting. 506 00:37:52,300 --> 00:37:57,100 And he would stain the canvases with tea bags and do other things to them to 507 00:37:57,100 --> 00:37:58,540 give them the appearance of age. 508 00:37:59,620 --> 00:38:02,700 Lastly, Bergantinos forges a signature. 509 00:38:03,420 --> 00:38:10,200 You can see it's white paint that he used to paint the actual words. But when 510 00:38:10,200 --> 00:38:15,380 you get close, you can see a brown tint to it. And it looks old to the naked 511 00:38:15,380 --> 00:38:22,200 eye. But when you actually test it, the brown is not... From 512 00:38:22,200 --> 00:38:28,000 grime or age, it's like a varnish on top to make the white not so brilliant. 513 00:38:28,440 --> 00:38:32,340 But in some cases, the red flags were remarkably apparent. 514 00:38:33,140 --> 00:38:37,240 Like if anyone had bothered to look closer at this pollock that hung on Anne 515 00:38:37,240 --> 00:38:38,800 Friedman's wall for decades. 516 00:38:39,320 --> 00:38:43,880 The signature for this work is down here in the lower. 517 00:38:44,670 --> 00:38:49,310 Right corner, you can see the forger didn't spell Pollock correctly. 518 00:38:49,570 --> 00:38:52,330 It appears that he left out a C. 519 00:38:53,810 --> 00:38:58,370 Investigators aren't sure whether Pei Shunchen is onto the scam from the 520 00:38:58,370 --> 00:39:01,670 beginning, but it's clear he eventually caught on. 521 00:39:02,290 --> 00:39:07,370 As a matter of fact, there came a time where he learned how much the paintings 522 00:39:07,370 --> 00:39:09,870 were being sold for, and he negotiated a raise. 523 00:39:11,010 --> 00:39:16,630 IRS agent Eric Yonke determines that Pei Shun -Chien gets paid a few thousand 524 00:39:16,630 --> 00:39:20,990 dollars each for his imitations of top abstract expressionists. 525 00:39:21,910 --> 00:39:27,590 Mr. Burgantinos was paying him $3 ,000 to $8 ,000 per painting, which is 526 00:39:27,590 --> 00:39:31,370 compared to what Ms. Rosales was initially selling them for. She's 527 00:39:31,370 --> 00:39:34,030 for hundreds of thousands to millions of dollars. 528 00:39:34,610 --> 00:39:36,810 In September 2013... 529 00:39:37,390 --> 00:39:42,230 Glafiro Rosales pleads guilty in court to wire fraud, money laundering, and tax 530 00:39:42,230 --> 00:39:43,230 evasion. 531 00:39:44,450 --> 00:39:49,810 By the time Glafiro confesses, Pei Shanqian has fled back to China. 532 00:39:51,030 --> 00:39:56,810 If fame and fortune was what he was hoping for, then perhaps he is a 533 00:39:57,390 --> 00:40:01,570 His works were in prominent museums. They sold for tens of millions of 534 00:40:01,570 --> 00:40:02,570 in the aggregate. 535 00:40:02,760 --> 00:40:07,580 He was a famous artist, but not for who he was, but who he was pretending to be. 536 00:40:08,540 --> 00:40:14,000 Jose Carlos Burgantinos Diaz and his brother have taken refuge in Spain. 537 00:40:14,820 --> 00:40:21,260 In 2016, Spanish courts ruled against extraditing 60 -year -old Diaz. He and 538 00:40:21,260 --> 00:40:23,800 brother still face charges in the U .S. 539 00:40:25,760 --> 00:40:30,400 Here in the States, Glefino Rosales is left holding the bag. 540 00:40:31,150 --> 00:40:38,070 She got nine months of home detention, and she got some supervised release 541 00:40:38,210 --> 00:40:45,210 and she got restitution and forfeiture to the tune of 542 00:40:45,210 --> 00:40:46,790 about $81 million. 543 00:40:48,350 --> 00:40:53,390 In her defense, attorneys argued that LaFerre's boyfriend put her up to the 544 00:40:53,390 --> 00:40:59,610 scheme. He was the one who had found the art forger, who then supplied Glyphura 545 00:40:59,610 --> 00:41:00,950 Rosales with the paintings. 546 00:41:01,490 --> 00:41:06,550 A string of civil cases have been filed against Knoedler and Company, art 547 00:41:06,550 --> 00:41:11,110 dealers Ann Friedman and Julian Weissman, and others taken in by 548 00:41:11,430 --> 00:41:14,190 No criminal charges were filed against them. 549 00:41:14,830 --> 00:41:19,420 This is so egregious that there are people who will... go to their grave 550 00:41:19,420 --> 00:41:24,000 Anne Friedman knew, the Knoedler Gallery knew, Julian Weissman knew. How could 551 00:41:24,000 --> 00:41:28,000 they not know? Because they themselves have never been on that end, and they 552 00:41:28,000 --> 00:41:31,020 don't realize what it means to be the victim of a con artist. 553 00:41:32,600 --> 00:41:38,880 Glyphira Rosales really embedded herself in the art world in a careful way 554 00:41:38,880 --> 00:41:43,600 that allowed Knoedler Gallery to look at the situation and say, this is 555 00:41:43,600 --> 00:41:44,600 convincing to us. 556 00:41:45,130 --> 00:41:48,790 Julian Weissman declined to comment for American Greed. 557 00:41:49,070 --> 00:41:53,650 To date, most of the lawsuits have been settled out of court. The defendants 558 00:41:53,650 --> 00:41:55,730 have denied any wrongdoing. 559 00:41:57,390 --> 00:42:02,630 Art and jewelry are the last sort of fashions of unregulated business. 560 00:42:03,050 --> 00:42:08,750 If you're a collector, if you're in this art world, it truly is buyer beware. 561 00:42:09,570 --> 00:42:13,890 This was the discovery of dinosaur bones that turned out not to be dinosaur 562 00:42:13,890 --> 00:42:14,890 bones. 563 00:42:15,120 --> 00:42:21,360 Glafira Rosales perpetrated the most important, most significant art fraud in 564 00:42:21,360 --> 00:42:22,360 this century.