Project Management Institute

The Real Thing

High-Tech Projects Aim to Ensure Art Forgeries Can't Blend In

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REUTERS / ALAMY STOCK PHOTO

Workers hang a Paul Gauguin work at Sotheby's. Below, “Unknown Man,” once thought to be by Dutch artist Frans Hals, has been declared a forgery.

A high-stakes game of cat-and-mouse has the art world scrambling. Last October, Sotheby's realized a painting it had sold years earlier for £8.4 million was a fake. It wasn't the first prestigious organization to fall victim to fraud: Knoedler and Co., once one of the oldest art dealers in the U.S., closed its doors in 2011 after selling more than 30 forged works for over US$60 million. Some experts believe that between 30 percent and 50 percent of the art market is fake—exact estimates are difficult, says Colette Loll, founder and director of Art Fraud Insights LLC, Washington, D.C., USA. One thing that is for sure: Major money is at stake. The art market was worth US$45 billion in 2016, according to the global TEFAF Art Market Report 2017.

The art market was worth US$45 billion in 2016.

Source: TEFAF Art Market Report 2017

The fraud epidemic will likely worsen as more art sales move online. The anonymity of the internet coupled with a lack of regulation could create a crucible for illegal activity, Ms. Loll says. “It's the perfect storm for fraud.”

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PHOTO COURTESY OF THE WEISS GALLERY

The only path forward, then, is countering the counterfeiters.

Ms. Loll's company, Art Fraud Insights, which works with everyone from artists and estates to dealers and collectors, exposes fraud through forensic analyses and online sleuthing. In April, a team completed a project to develop software that can identify fraudulent artwork online. Art Fraud Insights is now using the platform, Art and Artistic Legacy Protection, on behalf of artists and estates to infiltrate and monitor private online groups and auctions where fake art is being sold and to gather intelligence on key players dealing fake art, she says. (While a fake is commonly used to refer to an exact duplicate of an existing work, a forgery replicates a famous painter's style without copying a specific work of art.)

One of the project's biggest challenges revolved around creating a data delivery process that clients, who are often pressed for time and sometimes have limited technical skills, could understand, says Nikhil Grover, director of operations, Strategic IP Information, New Delhi, India. The company developed the software for Art Fraud Insights.

“The user interface and process needed to be seamless and easy enough for them to use and give us feedback. Otherwise it would overwhelm them rather than provide actionable insights,” Mr. Grover says. “So we worked closely with some prominent artists in the beta phase to build their feedback into the system.”

Deloitte Luxembourg is also leveraging technology to help prevent fraud. It completed a block-chain proof of concept project last year that tracks a piece of artwork's journey through time. The blockchain's distributed ledger proves the art's full transaction history in a secure environment accessible to every owner.

Certifiable

MyTemplArt, an organization based in Verona, Italy, is taking a different approach to artwork authentication: It's building a QR code-based system that can back up owners’ claims of authenticity. Once a piece of art has been verified by a separate organization (e.g., a museum or artist's estate), MyTemplArt creates a digital certificate of authenticity with a QR code and registers that code in a secure database, along with information identifying the piece's owner. A person wanting to prove ownership and authenticity can scan the QR code with the MyTemplArt app to generate a confirmation message from the database, verifying registration.

The project to develop this system started when Gianni Pasquetto, an art collector, discovered that several pieces in his portfolio were fake. The general manager of an enterprise resource planning software company, he immediately started imagining a database solution to the art world's fraud problem. In 2013, Mr. Pasquetto founded MyTemplArt and launched the project to develop the database that could store and secure key documents and data that prove ownership history. After five prototypes, the company completed the first version of the software in 2015; QR code functionality rolled out in May 2016.

The biggest obstacle the project team faced was communicating art-specific characteristics to the software company brought in to build the system, says Carel Colijn, commercial and technical director, MyTemplArt, Lausanne, Switzerland. For instance, developers naturally thought in terms of bandwidth when determining how images should be used. They preferred to work with thumbnails (small images) that load quickly for users. But when the goal is proving the authenticity of art, high-resolution photos allowing users to see details are a must-have—even if building that functionality means the project falls behind schedule.

“The software company did not set that requirement, and they built the wrong competency in the software for it,” Mr. Colijn says. “It's the classic conflict you have between those writing the technical specification and those doing the programming. You have to make them talk to each other to get the results that you want in an efficient way.” —Tegan Jones

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The anonymity of the internet coupled with a lack of regulation could create “the perfect storm for fraud.”

—Colette Loll, Art Fraud Insights LLC, Washington, D.C., USA

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

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