Wednesday, August 2, 2017

Museum Loss Prevention: Apply Rigorous Due Diligence

Museum Loss Prevention: Apply Rigorous Due Diligence
What due diligence can museums undertake to protect their collections of artifacts from risks of legal seizure?

Museums routinely and successfully protect their archaeological collections from threats of loss posed by theft, fire, natural disaster, and infrastructure failure. But do they effectively shield these collections from legal confiscation?

Tom Mashberg of The New York Times this week reported that the Manhattan District Attorney's Office seized a 2,300 year old vase on display at the Metropolitan Museum of Art in New York. The Paestan Red-Figure Bell-Krater allegedly was looted from a grave in Italy.

Meanwhile, cultural property watchers will remember that winter’s day in 2008 when federal agents in California raided the Los Angeles County Museum of Art, the Bowers Museum, the Pacific Asia Museum, and the Mingei Museum, armed with search warrants to “seize in place” ancient objects. Antiquities originating from Burma, Cambodia, China, and Thailand eventually were confiscated and repatriated, and the police investigation led to felony convictions in 2015 for a pair of art dealers who ran an antiquities import and tax fraud scheme.

Many similar news stories over the years serve as a reminder that rigorous due diligence needs to be applied before acquiring, and even while retaining, archaeological artifacts.

When a museum fails to acquire good title to an object because it is stolen, or when a museum finds itself in possession of illegally imported cultural contraband, then the illicit object may be legally seized. This can happen through a private lawsuit, called a replevin action; a civil forfeiture, usually brought by federal a prosecutor; a search warrant executed by police; or some other legal remedy that strips the artifact from the museum’s possession.

If the artifact is stolen, then the rightful owner—usually a country with a strong cultural property ownership law like Italy, Greece, Egypt, and Turkey—can regain the property. That is because American law generally holds that a rightful owner never loses title to property that is stolen from him. In fact, even an innocent purchaser typically cannot claim legal title to stolen property when the true owner steps forward to reclaim it. What’s more, the true owner is not required to pay compensation to a museum that is forced to surrender the stolen object to the true owner. That means a museum could suffer substantial financial loss. And most insurances won't even cover that kind of loss.

If the artifact is a specifically designated archaeological or ethnological object barred from import by U.S. customs restrictions erected under the Convention on Cultural Property Act, a museum that acquires the object may have to relinquish it to federal authorities for repatriation to the country of origin. Once again, the museum suffers a financial loss that is not covered by insurance.

These risks have been limited by some cultural institutions that have taken noteworthy proactive steps. Boston’s Museum of Fine Arts set the gold standard in 2010 with its addition of a curator for provenance, a full-time professional who carefully checks the collecting histories of objects.

Operational improvements, like this one, have proven beneficial in today’s legal and social environment where law enforcement and the public are more keenly aware that recently surfaced and undocumented ancient objects likely are the fruits of destroyed temples, plundered tombs, and vandalized ceremonial centers, which are sold on an art and antiquities market that lacks transparency.

Law enforcement and legal watchdogs, meanwhile, remain on elevated alert after the FBI's warning that antiquities trafficking may supply financial support to terrorists in the Middle East.

For cultural institutions still lacking solid protective measures that guard against collecting illicit artifacts, they are expected to face acute risk—both legal and reputational—particularly in cases where collected objects come from countries that suffer from, or that have recently experienced, widespread or highly publicized heritage site looting (e.g., Afghanistan, Egypt, Greece, Iraq, Italy, Mali, Syria).

Typically what causes a museum to acquire illicit artifacts is a lack of rigorous due diligence. Due diligence is the term used to describe the background investigation that cultural institutions should be employing to discover an artifact’s origin and its collecting history, especially the details of its excavation, ownership, possession, transportation, conservation, sale, and so forth. This inquiry may be referred to as a provenance check. It is a pre-acquisition investigation meant to uncover whether an object is authentic or fake, whether its export and import were compliant with applicable laws, and whether its title can transfer to the museum cleanly. Flawed due diligence may result in a museum acquiring an antiquity or other object that later could be removed from the collection by police, lawyers, or a court order.

To prevent such a loss—and the bad publicity that ultimately follows—a museum first should understand its fiduciary duty of care, which is the legal obligation imposed on trustees of all nonprofit institutions that demands the exercise of reasonable care when managing assets. This duty requires artifact accessions to be done lawfully and in good faith. The duty of care is embraced, in some measure, by museum codes of ethics like those published by the American Alliance of Museums (AAM), the Association of Art Museum Directors (AAMD), and the International Council of Museums (ICOM), which outline specific due diligence standards.

These standards, nevertheless, are neither uniform nor sufficiently rigorous in many cases. For example, while ICOM’s due diligence rule properly asks museums to “establish the full history of the item from discovery or production,” AAMD’s diminished rule limits a museum’s background check to “compliance with the export laws of the country of immediate past export to the U.S,” ignoring compliance with the laws of every country of export and import.

There is also disagreement in the museum community about the standard of due diligence review that should be applied. For example, one major museum’s collections policy declares that there must be “clear and convincing evidence” to prove that an object, already in the museum’s collection, had been stolen, looted, or smuggled before the object will be removed (deaccessioned) from the collection. Yet this same scrupulous "clear and convincing" standard is watered-down when the museum wishes to add a new archaeological object to its collection.

The best due diligence, in all cases, is rigorous due diligence. It is the kind of diligence that directs museum personnel to ask pointed and comprehensive questions and to insist on sufficient and credible documentation from dealers, auction houses, and donors. It is the kind of diligence that demands answers about whether an artifact has been stolen, illegally exported, or smuggled before an object is acquired and after an object is acquired. Rigorous due diligence easily satisfies museum trustees' duty of care and serves to prevent the loss of objects from a museum’s collection.

So what rigorous due diligence is actually due? One answer comes from a recommendation presented by collectors in 2009 to the Ancientartifacts Yahoo! group. Titled A Code of Ethics for Collectors of Ancient Artifacts, it offers the following suggestions identified in the quotes below with CHL's commentary below each suggestion:

"Ask the vendor for all relevant paperwork relating to provenance, export etc.”

That means asking for the bills of lading, invoices, customs entry forms, export permits, and all other paperwork that track the object’s movements.

“Take extra care if collecting particular classes of objects which have been subjected to wide-scale recent looting.”

For example, avoid acquiring artifacts that are listed on one of ICOM’s publications known as RedLists, which identify at-risk cultural heritage originating from countries that suffer severely from cultural heritage looting and plunder.

“Verify a vendor’s reputation independently before buying. Assure yourself that they are using due diligence in their trading practices, and do not support those who knowingly sell fakes as authentic or offer items of questionable provenance.”

Learn more about the dealers, auction houses, and donors offering artifacts by getting client references, scanning publicly available court records for criminal or civil claims against them, and reviewing corporate records (available on many secretary of state offices’ web sites) to verify legitimacy.

“Do not dismember any item, or acquire a fragment which you believe to have been separated from a larger object except through natural means.”

For instance, beware of acquiring a single object that would have been paired with another object. You would be suspicious if a salt shaker were sold without its companion pepper shaker, so be suspicious if a single statue that is commonly found a part of a pair is offered for sale.

"Consider the implications of buying an item from an associated assemblage and the impact this could have on study."

Be cautious when considering the purchase of one portion of an entire temple wall or a single cut-out from a complete ancient papyrus roll, for example.

“Liaise, where possible, with the academic and broader communities about your artifacts.”

Have open conversations about the object and its collecting history in order to learn more perhaps about its provenance from experts.

A recommendation not suggested by the Ancientartifacts group, but which is absolutely important, is conducting a visual inspection of the object. Use a black light to spot unusual marks or cover-ups like nail polish, which can be used to remove an identifying registration number from an inventoried museum object. Examine edges to see if they are straight and smooth to help determine whether an object has been cut recently from its original archaeological source as when looters use diamond-tipped steel circular saws to cut decorative slabs from ancient tomb walls.

Effective loss prevention involves the application of this kind of rigorous due diligence. It helps cultural institutions acquire valid legal title to licit cultural objects and protects museum collections from legal seizures, all while instilling public confidence in museum collecting practices that aim to preserve humanity’s precious cultural heritage.

To learn more about this topic, register for IFCPP's annual conference here. It will be held in September on the campus of Yale University in New Haven, Connecticut.

Photo credit: Szorstki/

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