Inigo Philbrick, the art world wunderkind who allegedly fled to Vanuatu last year as his schemes unraveled, pleaded guilty to one count of wire fraud in federal court on Thursday—and his lawyer suggested a “sick industry” was to blame.
The disgraced dealer, who is engaged to a British reality TV star, must forfeit more than $86 million and stakes in two pieces of art, and he could face over a decade in prison.
“I knew that my actions were wrong and illegal,” Philbrick said in a statement he read aloud in court.
Prosecutors had charged Philbrick with wire fraud and identity theft, alleging that he defrauded investors by selling more than 100 percent ownership stakes in art pieces, secretly using artwork as collateral on loans without telling other owners, and attempting to shield his crimes with bogus paperwork.
In the Manhattan courtroom, he admitted to the fraud, which he said he operated between 2016 and 2019.
Prosecutors said that had the case gone to trial, they would have furnished extensive evidence to prove their case, including emails and text messages, bank records, contracts, and testimony from multiple victims.
Judge Sidney Stein said that sentencing guidelines call for 121 to 151 months of prison time, but that Philbrick could receive a sentence outside that range on March 18. Stein added that Philbrick, 34, will have to serve the full term of his punishment, without the possibility of parole.
In a statement, his attorney, Jeffrey Lichtman, said, “Inigo accepted full responsibility for his actions today and will pay for his crimes the rest of his life.
“While his actions were dishonest and criminal in nature, he’s part of an industry sick from top to bottom where this sort of behavior is sadly commonplace. That being said, he apologizes to his victims and will do all that he can to make them whole.”
Philbrick’s downfall began in 2019, when one of his paintings commanded significantly less than he expected at auction, which precipitated intense scrutiny from his clients.
One client, the German firm Fine Art Partners, ultimately filed a lawsuit claiming that Philbrick had refused to return art pieces it owned. Other allegations soon followed.
It was quickly obvious in the art world that one of the industry’s most ascendant young dealer’s had been playing financial games.
Meanwhile, Philbrick skipped away to the South Pacific nation of Vanuatu, where he played tennis and rented a house on the beach. It was only a matter of months before he was arrested and shipped back to the United States.
During Thursday’s proceedings, Judge Stein asked Philbrick to explain why he committed the fraud.
His answer: “Money, your honor.”