London dealers embroiled in Ezra Chowaiki fraud scheme over $1.2m Chagall painting

Fresh complaint seeks the return of the work allegedly sold by the disgraced Manhattan dealer under false pretences

Marc Chagall's Bouquet de giroflées (1971) is listed as stolen on the FBI’s database

Marc Chagall's Bouquet de giroflées (1971) is listed as stolen on the FBI’s database

One of the victims of the disgraced Manhattan dealer Ezra Chowaiki has filed a fresh complaint in the New York Supreme Court against three London dealers saying they should return a Marc Chagall painting that Chowaiki sold to them under false pretences.

Last September, Chowaiki was sentenced to 18 months in prison for his elaborate multi-million-dollar fraud scheme which involved selling art, purportedly on consignment, without the owners’ authorisation. Among those works, court papers say, is a 1971 oil painting by Chagall, Bouquet de giroflées, which the Pennsylvania collector Rick Silver purchased from Chowaiki for $1.2m in 2015.

According to the lawsuit, Chowaiki then duped Silver into sending the painting to the Chowaiki Gallery “under the false pretence” that he would sell it on Silver’s behalf.

Without his knowledge or consent, Silver claims that Chowaiki sold 25% shares in the Chagall for $250,000 each to a group of London dealers: Hugh Gibson, Alon Zakaim and David Breuer-Weil. They, in turn, sold the painting to another collector and are now being sued for its return. The dealers all “vigorously contest” Silver’s claims.

In a joint statement Gibson, Zakaim and Breuer-Weil say: “The previous owner consigned the painting to Chowaiki & Co for sale. We bought the painting, in good faith from the gallery, paid for the painting in full and received the work and its certificate.”

The former art dealer Ezra Chowaiki leaves Federal Court with his lawyer after his arraignment in December 2017 © Matthew McDermott/Polaris

However, Silver alleges that the London dealers ignored numerous “red flags” when it came to the purchase, failing to perform the “most basic due diligence”. According to the court papers, Chowaiki told the dealers that Silver was technically “the only rightful owner” of Bouquet de giroflées, yet the defendants made no effort to establish whether Silver had been paid. Furthermore, had they searched the publicly available UCC-1 financial statements they would have found that Chowaiki had already taken out a loan with the private finance company Borro using the painting as collateral. Silver says he had no knowledge of the loan. Three Alexander Calder paintings and a pencil drawing by Fernand Léger are also listed as having been used by Chowaiki as collateral for loans.

Silver claims the London dealers “expressed uneasiness” over the sale on several occasions after they wired Chowaiki $1m for the Chagall. One email from Zakaim reads: “Every day for three weeks we were subject to a different reason as to why the painting or the certificate [of authenticity] was not delivered… I will not accept this level of incompetence any longer. I have been silent for over a week to give you the opportunity to redeem yourself but I cannot sit by [and] have my reputation ruined by this nonsense.”

In November 2017, Chowaiki Gallery filed for bankruptcy, shortly after the Chagall painting was sent to London. In April 2018, Silver filed a claim asserting his ownership of the work and his right to recover it.

Bouquet de giroflées is listed as stolen on the FBI’s database. The agency estimates that works valued at more than $30m are still being processed as a result of Chowaiki’s criminal activities.