Detained at 7:45 a.m., the Old Master dealer Lawrence B. Salander, along with Salander-O’Reilly Galleries, founded in 1976, were served with a 100-count indictment for stealing $88 million from over two dozen investors and clients.
The arrest represents the latest legal proceedings since the forced closing and bankruptcy of the East Side Gallery in October 2007. Manhattan District Attorney Robert M. Morgenthau released a detailed report yesterday, listing charges that include multiple counts of grand larceny, securities fraud, and falsifying business records. It also described the two primary methods Salander used to steal: he sold artwork not owned by him and kept the money; and lured investment money in fraudulent investment opportunities.
Amongst the more high profile personalities affected by Salander’s schemes, was tennis star, John McEnroe, who is allegedly out $2 million. The celebrity invested in two Arshile Gorky paintings, Pirate I and Pirate II, which unbeknownst to him were already sold to another duped investor. Renaissance Art Investors is out the most amount of money, having acquired 328 Old Masters from the dealer, and upon their re-consignment to the gallery, lost approximately $42 million dollars. In this case, the litany of Salander’s misrepresented facts and figures, constitutes over 200 words in the Morgenthau’s report. Other figures suffering loses include Earl Davis, son of painter Stuart Davis, and Robert DeNiro, who is part of a separate probe.
Although not mentioned in Morgenthau’s report, Salander made plenty of headlines for his lavish lifestyle as the gallery closed in 2007. He flew private jets to Europe, spent $60,000 on party for his wife at the Frick, and even at the time his arrest yesterday, was living at his 66-acre estate in Tony Millbrook.
Salander is currently being held on $1 million bail, and pleads not guilty to the charges.
Paddy Johnson is the editor of Art Fag City.