A hidden difficulty for auction houses

[D. Bergin]

Originally Posted by Rich Klein

Your family is likely not going to show up as pubilc figures .

The Kennedy's are. Listen; my only point on this; as has been borne out; is that the auction company has some issues that we as collectors do not always realize. And my question is what steps does an auction house have to take.

Rich

So only public figures warrant protection from the FBI?

This makes me a little sad.



On a serious note, I'm not sure auction houses can do much more then make consignors sign ownership of title papers and research the items as much as the available information allows them to.

It's a hazard of the business I guess.

[drc]

I had an expensive item that a celebrity lawyer's said was stolen from the celebrity. I won't go into the details, but evidence/research proved it was not. I presented this info the lawyer and never head back from him again. What bothered me about the episode was the lawyer didn't say it he had reason to believe it might or could have been stolen, but that it was stolen when this turned out to entirely false and impossible.

The meat of the story is that, due to money dispute, the celebrity never attended a big event and so the organization chose not to give the celebrity the item. It was documented who the organization instead gave the item to (an official who did show up to the event) and that that it was later purchased directly from this official's family. In short, the celebrity was never given, owned or even physically touched the item, much less could have had it stolen.

Yes, items are stolen. But do I think one should simply go by a celebrity's, family member's or family lawyer's say so? The above story should give you a good hint as to the answer.

[Rich Klein]

And I think you realize this; is that for my family (and probably for yours) we're not going to have letters our ancestors wrote show up in public auctions for thousands of dollars

I still think there is a tricky slope for auction Houses in so many ways; and how much does the AH has to do to make sure nothing is wrong. Do they have to have every item checked out by the FBI?

Rich

P.S. A good friend of mine back in my Jersey days bought a ton of gold/silver/jewerly in his store. And anything they were not sure about was reported to the Elmwood Park, NJ police and run through their system to make sure it was not stolen. And I believe that was NJ state law at that time.
Is the next step to have anything an auction house gets in checked out by the Feds?

Like I said; this is a real hidden problem

[drc]

Rich, I don't believe this will be the case with memorabilia auctions.

If you have the consignor sign a statement of ownership/provenance (where bought from if not the whole known history) and the auction does reasonable diligence and follow through on questionable situations or particularly significant items (Elvis' wedding ring, for example), that is enough. There's no need to have all lots run through the FBI-- would be a rather pointless exercise anyway, as I don't know what the FBI could do when handed a 1895 football noseguard anyway. There already are laws and procedures for recouping money for sold stolen items.

Keep record of from who you purchased an item from. If the item turns out to be stolen, this is the person from where you get a refund. If that seller was also innocently wronged, he would get a refund from the person he purchased from-- and so on down the chain. It doesn't matter if the auction house or consignor was an innocent victim, the sale was not legal-- in fact, legally speaing there was no sale-- and you get your refund.

If you purchase a stolen item from an auction house, you would get your money the auction house or consignor-- you wouldn't have to worry about finding the original source. The auction sale was not a legal sale (the owner didn't even know his stuff was up for sale!), so you get your money back from that sale.

[Exhibitman]

David, as I tried to point out above the law is actually much more complex and highly fact dependent as to whether there is a sale or not. It is not as simple as "no sale" in all cases.