Home Interior Design Art consultant Lisa Schiff hit with ‘Ponzi scheme’ lawsuit after Adrian Ghenie art-reversal deal goes awry

Art consultant Lisa Schiff hit with ‘Ponzi scheme’ lawsuit after Adrian Ghenie art-reversal deal goes awry

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High-profile art adviser Lisa Schiff has been sued by two longtime clients and friends: real estate heiress Candace Barasch and Richard Grossman.

The plaintiffs allege that Schiff, who runs the New York-based consulting firm Schiff Fine Art, owes them $1.8 million ($900,000 each) related to the sale of a painting by wanted Romanian artist Adrian Ghenie . Barasch and Grossman filed a lawsuit in the New York State Supreme Court on May 11. The causes of action are breach of contract, conversion, fraud, breach of fiduciary duty and conspiracy.

The complaint appears to be another example of art diversion for profit gone wrong.

In addition to the money allegedly owed, the plaintiffs accuse Schiff of setting up a “Ponzi scheme”. Their filing outlines Schiff’s alleged lavish spending, including a $25,000-a-month apartment in New York, an international first class travel with concierge services and limousines, five-star hotel vacations, and shopping sprees in New York and Europe for designer clothes and jewelry.

Meanwhile, plaintiffs claim Schiff doesn’t have the money she owes them. Knowledge of Schiff’s personal expenses was said to have been gained from extensive travel and a personal friendship with the adviser, the couple claim.

Schiff’s attorney, John Cahill, declined to comment. Wendy Lindstrom, the attorney representing Grossman and Barasch, said “it is shameful that Schiff, who was trusted professionally and personally, exploited that trust.”

In April 2021, Schiff alerted Barasch and Grossman that a painting by Ghenie, Uncle 3 (2019), was available for purchase. After discussions, including with Grossman’s wife, whose name is not identified, they agreed to purchase the work. The original purchase price is not disclosed in the court documents, but Barasch took a 50% stake and Grossman and his wife each acquired a 25% stake. Neither of them took possession of the work; it was shipped to a storage unit in Delaware.

Ghenie is a sought-after painter who is represented by the mega-gallery Pace. His paintings evoke the twisted imagery of Francis Bacon’s portraits. “These figures, largely derived from mid-20th century historical sources, appear in haunting interiors as dreamlike or cinematic vignettes,” says the artist page on Pace’s website. Ghenie appropriates the tropes of slapstick film in her “Pie Fight” paintings, which blend figuration and abstraction. The record for a work by Ghenie sold at auction is $10.3 million for Interior Pie Fight 12 (2014), sold at Christie’s Hong Kong in May 2022.

In November 2022, Bartsch and Grossman agreed to a resale of the artwork, completing the deal, which will be negotiated by Schiff, via an oral agreement. They agreed to sell the work for $2.5 million and split the proceeds, after a commission to Schiff of ten percent of the price, or $250,000.

According to the complaint, the deal was made through Sotheby’s Hong Kong and the work was delivered to the auction houses’ headquarters on York Avenue in December 2022. Sotheby’s declined to comment.

In January, $225,000 of the sale proceeds were transferred to Grossman and Barasch (a total of $450,000), and Schiff took his commission at the time, according to the complaint. Schiff promised to pay the additional $1.8 million ($900,000 each) to investors on March 26.

However, by March 26, Schiff “requested an additional thirty days to make payment, saying the delay was an accommodation for buyers in Hong Kong, but assuring requesters that buyers were not forgoing the sale and guaranteeing that the A payment of $1.8 million would be made,” the complaint states.

Earlier this month, when none of the customers had received the balance of the promised purchase price, they texted Schiff to say they were frustrated by the delay. According to the complaint, Grossman had clearly stated that “these products were intended and necessary for the support of Grossman’s elderly in-laws, particularly with the cost of their move from assisted living hospital. » At that time, Schiff replied that she was “working on it…”. says the suit.

However, on May 8, “Schiff conceded to the plaintiffs that the money owed to them from the sale of Ghenie’s painting was gone,” the complaint states.

Grossman maintains that Schiff revealed this during a final in-person meeting. “For the first time, Schiff said him, she didn’t have the money owed to plaintiffs, and to call his lawyer, then walked far from him.”

Grossman and Barasch are demanding that Schiff return the $250,000 commission earned on the transaction, plus interest, along with “damages of at least $2.05 million plus interest.”

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