Art by Jean-Michael Basquiat was allegedly sold by a gallery owner in an art fraud. Photo: AP

A Miami art dealer who went on the lam last year is accused of defrauding investors and collectors out of more than $20 million in an alleged scheme to prop up his business.

A criminal complaint has been unselaled against Inigo Philbrick, who specialized in post-war and contemporary fine art sales before disappearing for several months.

Inigo Philbrick. Photo: Getty Images

The complaint charged Philbrick, 33, made "material misrepresentations and omissions" to art collectors, investors and lenders for four years, passing himself off as a dealer of valuable pieces and selling more than 100% ownership in the works without clients' knowledge.

Prosecutors in New York alleged Philbrick sold the artworks as collateral for loans and never disclosed the ownership interests of third parties to buyers and lenders, a device set in the theater world in the Mel Brooks comedy "The Producers."

Philbrick, the son of a Philadelphia museum director, fled to the South Pacific nation of Vanuatu last September after defaulting on a $14 million loan, prosecutors said. He was arrested Thursday on charges of wire fraud and aggravated identity theft, and was transported to Guam for an initial court appearance.

"You can't sell more than 100 percent ownership in a single piece of art, which Philbrick allegedly did, among other  scams," U.S. Attorney Geoffrey Berman said in a statement announcing the charges in the Southern District of New York. "When his schemes began to unravel, Philbrick allegedly fled the country. Now he is in U.S. custody and facing justice."

Among the notable pieces connected to the alleged scheme were works by Jean-Michel Basquiat and Christopher Wool, as well as an untitled 2012 painting by Rudolf Stingel depicting artist Pablo Picasso.

Philbrick purchased Basquiat's "Humidity" at auction for $12.5 million in 2016 but produced a fake contract for an investor saying he paid $18.4 million for the painting, an arrest warrant request said. The investor paid $12.2 million for the artwork, and a second investor bought a 12.5% stake for $2.72 million. Philbrick told a finance company in 2017 that he was the owner and received a $3.25 million loan using the painting as collateral.

Prosecutors said Philbrick's crimes came to light after lenders and investors discovered they were given false records. After investors filed civil lawsuits in multiple jurisdictions, Philbrick stopped responding to the suits and shuttered his galleries in Miami and London.

Flight records obtained by investigators showed he left the United States around the time news media began reporting on the litigation and was living in Vanuatu since last October.

"Mr. Philbrick allegedly sought out high-dollar art investors, sold pieces he didn't own and played games with millions of dollars in other people's money," William F. Sweeney Jr., assistant director in charge of the FBI in New York, said in a statement. "If convicted, he might have to trade in his jet-set life for a drab federal prison cell."

Philbrick applied in 2018 to do business in Florida through Philbrick Inc., which was listed as a Delaware corporation with its principal business in London's affluent Mayfair district and a suburban Los Angeles mailing address. His gallery was in the seven-story Design 41 building in Miami's Design District.

Wire fraud carries a maximum prison term of 20 years, and an aggravated identity theft charge carries a mandatory sentence of two years in prison.

This case is being handled by the money laundering and transnational criminal enterprises unit of the Manhattan U.S. attorney's office, with Assistant U.S. Attorneys Jessica K. Feinstein and Cecilia E. Vogel in charge of the prosecution.

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