Asymmetrical Information - Megan McArdle
10.19.12 3:14 PM ET
So You've Stolen a Valuable Painting. What Do You Do Now?
Much as all of us loved Ocean's Twelve, I'm sure, it turns out that there's not really much money in high-end art thievery. The reason: you can't sell the stuff.
And the reason I say that is towards the end of my career in 2008, I was undercover on an investigation involving Miami, Madrid, Barcelona and Paris. And we identified a group in Marseille that had 75 paintings that they had stolen from all around Europe, and they wanted to sell them. And none of them had been sold. These were obviously paintings that had been stolen from many different heists. And nobody had made any money on them.
The reason? Provenance. High-end art needs to come with a chain-of-custody that authenticates it; otherwise it's basically worthless. And stolen paintings don't have one. (There was a not-very-good 1950s thriller called The Light Touch which exploits that point.)
What's interesting to me is that provenance requirements didn't necessarily arise in response to the problem of theft, but rather, as I understand it, to the problem of forgery. An authentic Rembrandt is worth millions. An indistinguishable painting manufactured in 2012 is worth a couple hundred bucks, at best. And it is quite possible to produce forgeries which fool experts for years--now more than ever, with all the technical aids that forgers have at their disposal.
People who might not mind buying something that was stolen from someone else still very much mind the prospect of being fooled. So provenance has gotten more and more important over the years. And as a result, it has apparently mostly killed the market for stolen art.
The big mystery is, of course, why thieves continue to steal the stuff. The FBI agent interviewed by The Atlantic says that it's because they're very good thieves . . . but very bad financial planners:
I can't make a blanket statement. But what I can say is, after 20 years of doing these investigations for the FBI, there is a general pattern. And the general pattern is that the criminals who do these jobs, these heists, are good thieves, but they're terrible businessmen. That's what it comes down to.