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Tuesday, December 29, 2015

"Antiques" from Syria: U.S. Cultural Property Import Stats Raise Suspicion


Imports of Syrian goods into the United States have fallen dramatically since war broke out in the Mideast nation in 2011 and since the White House expanded the Syria Sanctions Program. Yet, despite the decline in U.S. imports from Syria, there are now disquieting trade statistics from 2014--the most recent complete data available--that should stir the attention of customs officials, police, and policymakers concerned about looted archaeology, stolen mosaics, and illicitly excavated coins trafficked illegally into the U.S.

Overall, America imported about $429.3 million worth of declared goods from Syria in 2010. Last year, that total collapsed to roughly $12.4 million, a stark decline over the five year period.

Moving in the opposite direction for a period of time were U.S. imports of antiques over 100 years old from Syria, which spiked to $11 million in 2013, a spectacular 133% increase in declared customs value over the previous year. While this figure noticeably fell last year to roughly $4.9 million, the value is similar to the $4.7 million worth of imported antiques recorded in 2012.

The 2014 statistic on antiques is striking because the five year trend line for imports of Syrian antiques failed to fade to black like other U.S. imports of Syrian goods. Instead, as the graphic above demonstrates, antiques constituted a decidedly large slice of the American import pie last year. They accounted for a whopping 40% of the value of all imports of every kind from Syria. In fact, goods classified by importers as Antiques of an Age Exceeding 100 Years under Harmonized Tariff Schedule (HTS) 9706 were the #1 import into the U.S. from Syria. There simply was no other import category that ranked higher in value than antiques, including the #2 import of Syrian anise and cumin seeds and juniper berries classified under HTS 0909.

Notably, every Syrian import classified as an HTS 9706 antique was shipped to the customs district of New York City, the location of one of the largest and most important art and antiquities markets in the world.

What we do not know is what kind of objects these "antiques" were. They may have been at-risk archaeological objects like cuneiform tablets or ancient pottery, deliberately mislabeled by smugglers as being "of an age exceeding 100 years." Customs officials need to find out.

Enforcement officials also need to investigate the #3 American import from Syria in 2014, commodities classified by a code smugglers might use to disguise imports of ancient mosaics. Mosaics, of course, are architectural features made of stone, glass, and/or ceramic. They are spotlighted in the International Council of Museum's Emergency Red List of Syrian cultural property, which is why the import of $1.4 million worth of HTS 6802 goods--11% of the total value of all Syrian imports to the U.S.--is concerning. HTS 6802 is intended to cover worked monumental or building stone; mosaic cubes of natural stone; and artificially colored granules, chippings and powder of natural stone. Yet the code may have been used by traffickers to unlawfully classify 5th century mosaics.

Together,  the declared imports of HTS 9706 and HTS 6802 goods accounted for 51% of the total imports of all Syrian commodities by value in 2014, a striking statistic that simply cannot be overlooked by cultural property watchers focused on spotting trafficked heritage objects that may have illegally piggybacked on legitimate international trade.

Classified by HTS 9705 and amounting to approximately $303,000, collections of historical and archaeological material of Syrian origin was the #5 import by value in 2014. This number was almost a triple increase from the $118,000 imported the year before.

Looking deeper into this trade category, we find that the bulk of HTS 9705 imports from Syria to the United States consisted of Numismatic (Collectors') Coins, Except Gold, classified by HTS 9705.00.0060, having a declared import value of approximately $265,000, which was a quarter of a million dollar jump from the exiguous value of $12,064 declared in 2013. Just like imports of Syrian antiques, every Syrian collectors' coin declared under this HTS category went through the New York City customs district. Were these coins ancient Roman, Byzantine, or Islamic like the ones identified on the Red List? Customs enforcement officials need to find out.

Given the reasonable articulable suspicion that Syrian cultural contraband may be moving to the U.S. through ordinary channels of international trade, police and customs investigators are justified in scrutinizing import paperwork and asking detailed questions of importers and customs brokers that will confirm or dispel this suspicion. To protect cultural heritage in jeopardy, to defend against money laundering, and to protect against terror financing in Syria, it is vital to know exactly what cultural property has been shipped to the U.S. from Syria under the HTS 9705, 9706, and 6802 classifications and why heritage goods makes up such a large portion of imported Syrian commodities.
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Data source: CHL compiled, arranged, and assessed the import figures presented here using raw data collected by the U.S. International Trade Commission and the U.S. Bureau of the Census.

Copyright notice: Although the data presented here is sourced from publicly available information, it is an original work of authorship that has been carefully selected, coordinated, arranged, and analyzed so that it is an original work of authorship subject to copyright protection as a compilation and/or a derivative work by CHL. The publication, retransmission, or broadcast of this compiled data is strictly prohibited without CHL's express consent.


Note: Import data is reported to U.S. Customs and Border Protection by the owner, purchaser, or licensed broker of the consignee. They file the entry documents, not the customs officials who are unable to inspect and document every cargo shipment. So whether cultural commodities are properly classified as HTS 9705 archaeological material or HTS 9706 antiques is the responsibility of the importer. In fact whether imports are falsely classified so that they can be smuggled across the border or whether they are mistakenly classified because of an error in judgment is a function of the importing party. The import classification process is a self-reporting system, part of a shared compliance program overseen by U.S. Customs that obliges the trade community to regulate itself and follow federal law. Shared compliance allows the U.S. to competitively engage the world in global commerce. Smugglers, nevertheless, will try to exploit gaps and loopholes.
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Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & Policy Research, Inc.

Thursday, December 17, 2015

Museum Raids Cases: Rare Antiquities. Rare Convictions for Gallery Owners. Rare Prison Sentence.

In the annals of cultural property law, prosecutions targeting transnational antiquities trafficking networks are rare. Even more rare are felony convictions. Scarcer still are prison sentences.

So what happened this week to a pair of California gallery owners tied in with the "Museum Raids" cases is a momentous achievement, an example of careful and intelligent case development by the U.S. Attorney's Office for the Central District of California, resulting in felony convictions for antiquities traffickers rather than a "seize and send" photo-op that cultural property watchers are accustomed to witnessing.

Jonathan and Carolyn Markell, aged 70 and 68 and owners of Silk Roads Design Gallery, were sentenced on Monday for their role in an elaborate scheme that mixed international heritage trafficking with tax evasion.

Calling the crime "significant," United States District Judge Dean D. Pregerson said it was “important to send a message” to art collectors, gallery owners and museums that they should avoid collecting and trading looted antiquities.

The court handed down an 18 month prison term to Jonathan Markell on a felony count of conspiring to import goods using false statements in violation of 18 U.S.C. § 371 (conspiracy) and 18 U.S.C. § 542 (importing goods using false statements). His wife, Carolyn, received a sentence of probation on a felony charge of conspiracy to commit tax evasion pursuant to 18 U.S.C. § 371. Jonathan Markell also pleaded guilty to conspiracy to commit tax evasion.

“Mr. Markell’s greed placed his art gallery’s profits above the culture and heritage of the people of Thailand,” said United States Attorney Eileen M. Decker in a press release.

There were no complaints about the court's 1 1/2 year sentence, even though prosecutors sought a 2 ½ year prison term for Jonathan Markell because, in prosecutors' words, "it is clear that Jonathan Markell has no respect for the law—not this nation's laws, nor those of other nations."

In seeking a prison term, prosecutors, notably among them Assistant U.S. Attorney and Environmental Crimes Chief Joseph Johns, sought both specific deterrence and general deterrence.

The attorneys pointed out the obvious to the court, that "it is rare that law enforcement officials have the opportunity to catch a broker, bulk sellers, or gallery owner that drives the illicit market for archeological resources." That is why, they contended,
Defendant Jonathan Markell’s antiquities smuggling case presents a unique opportunity to send a message and afford adequate deterrence to the 'upper end' of the criminal black market for looted archeological resources, i.e., the brokers and gallery owners who sell their wares to the collectors. If we are able to diminish and disincentivize the market (or demand) for illegal antiquities, then we may have an equal effect on taking the monetary incentives out of the act of looting itself. It is the market, or demand, which drives the looters at the ground level to provide the supply of stolen antiquities to meet that demand. 

Jonathan Markell’s sentence of 18 months behind bars perhaps is the most ordered by a court in a transnational antiquities trafficking case since U.S. v. Schultz, a federal case from 2002 that saw Frederick Schultz, a high profile and successful Manhattan antiquities dealer, sentenced to serve 33 months in prison after a jury found the defendant guilty of the felony of receiving stolen Egyptian antiquities that had been transported in interstate and foreign commerce in violation of 18 U.S.C. § 371 (conspiracy) and 18 U.S.C. § 2315 (the National Stolen Property Act).

That case failed to serve as a warning to the Markells as the investigation into the husband and wife and their co-conspirators began the following year, in 2003 when a National Park Service (NPS) special agent began to uncover the trafficking network that had been smuggling archaeological material from Southeast Asia.

In January 2008, federal agents from several law enforcement agencies raided a variety of locations, including four museums in California. Police descended on the Los Angeles County Museum of Art, the Bowers Museum, the Pacific Asia Museum, and the Mingei Museum with search warrants to “seize in place” ancient objects identified as potential evidence. Officials simultaneously seized evidence from the Markell’s home as well as their art gallery.

The museum raids generated three published criminal cases:

  • United States v. Robert Olson and Marc Pettibone, et al., which charged a conspiracy to smuggle Southeast Asian artifacts, including from Thailand and Cambodia, into the United States beginning in 2004;
  • United States v. Robert Olson and Jonathan Markell, which charged a conspiracy to smuggle Southeast Asian artifacts, including Burmese antiquities obtained in Thailand beginning in 2003; and
  • United States v. Jonathan Markell and Carolynn Markell, which charged a conspiracy to commit tax fraud by making false statements when donating smuggled artifacts to museums in an effort to receive tax deductions.
[Sidebar: At least one media report by the Pasedena Patch suggests that legal action against unnamed museums resulted in deferred prosecution agreements. These agreements do not appear in the court system’s public files. It is possible that they are held privately by the U.S. Attorney's Office and not subject to public disclosure]

The Markells pleaded guilty to criminal charges on April 16 after signing a written agreement with federal prosecutors the previous month..

As part of the deal, both defendants conceded that they conspired to knowingly and intentionally defraud the United States for the purpose of impeding, impairing, obstructing, and defeating the lawful government functions of the Internal Revenue Service (IRS) in the ascertainment, computation, assessment, and collection of income taxes, by promoting and participating in a false charitable deduction scheme for the purpose of improperly claiming charitable deductions on federal income tax returns.

The Markells agreed to repatriate 337 artifacts by ocean-borne cargo to their countries of origin, specifically China, Thailand, Cambodia, and Burma; to pay the $25,000 estimated shipping cost; and to cooperate with the IRS to calculate back taxes and penalties from 2004 through 2007, estimated to be $39,891.

In a court pleading filed on December 3, attorneys for the government elaborated on the facts of the case:
In short, Jonathan and Carolyn Markell jointly owned and operated the business Markell Imports, Inc., doing business as the Silk Roads Design Gallery ("Silk Roads"). The Markells’ business model consisted of their purchase and importation of art, antiques, and archeological resources from Southeast Asia, and their resale of such merchandise through their Silk Roads art gallery in West Hollywood.

Part of their business model included the intentional use of false declarations and statements in United States Customs entry documents to “smuggle” or introduce the archeological resources “antiquities” into the United States.

The lawyers flagged a contention made by the Markells, one that is often echoed by ethically ambivalent antiquities dealers who complain that filling out customs forms is too burdensome for small business owners:
During [a police interview], Jonathan Markell stated that he and Carolyn Markell falsified the customs documents to disguise what they were importing because the United States Immigration and Customs Enforcement classification process is difficult if they actually identify a piece as an "antique." Carolyn Markell agreed with her husband's statement.

The Markells further justified their behavior by claiming that United States Customs forces people to lie on import declarations because of the delay in clearing Customs if they properly identify an object as an antique.

Prosecutors added that the Markells failed to fully disclose their criminal conduct to investigators. “For example, they did not admit that Jonathan Markell had conspired with [a] co-defendant to not only falsely describe Burmese and Khmer antiquities in United States Customs import documents ... but also to falsely declare the import value of those antiquities as 25% of their true purchase price.”

The attorneys said that neither defendant “admitted ... that they knew that it was illegal to export archeological resources/antiquities from the countries of China, Thailand, and Burma—which is most likely the reason that the antiquities were falsely described in United States Customs import documentation.”

Focusing on the pairs’ systematic plan to dodge federal taxes, prosecutors noted that the operation “was heavily dependent upon the ready availability of Southeast Asian antiquities obtained ... through the antiquities smuggling scheme .... The Southeast Asian antiquities smuggled into the United States ... were bundled and sold for approximately $1,500. The[] $1,500 ‘package’ typically included antiquities from Ban Chiang, Thailand, false sales invoices to reflect an earlier sales date, along with a fraudulently inflated $5,000 appraisal that contained a fraudulent expert's signature.”

Prosecutors called the defendants' conduct a “complete contempt for this Nation's rule of law," spotlighting "Carolyn Markell's discussion of the International Emergency Economic Powers Act ("IEEPA") Burmese sanctions with the undercover agent ('UC') in this case":
During that discussion, she told the UC that she had been extremely worried about the last shipment of antiquities that she and Jonathan Markell had brought into the United States from Thailand in September 2006—which had included 7 Burmese statues. She related to the UC that the President of the United States had prohibited entry of any Burmese items into the country, and that she had lost sleep worrying that their import shipment would be intercepted by United States Customs authorities. She told the UC that she did not care about being dishonest, but that she didn’t want to get caught.

Jonathan Markell, meanwhile, “brought up a Los Angeles Daily News article about an individual that had been prosecuted for a tax evasion scheme involving antiquities and a museum," according to prosecutors. "Jonathan Markell laughed about the article, and then asked the UC if he thought that he (Jonathan Markell) was going to jail (for the tax evasion scheme). Jonathan Markell told the UC that the person who had been caught must have done something pretty stupid, and that the government was not going to look at any donation under $10,000.”

The tax scheme relied on the couples’ assumptions that customs officials would overlook mislabeled illegal shipments and that museums and collectors would fail to conduct the due diligence necessary to verify the archaeological objects’ legitimate collecting histories.


Antiquities mostly from Thailand's Ban Chiang World Heritage site were used to fuel the fraud, according to recitals found in the plea agreement, which described how Jonathan Markell “solicited co-conspirators to buy a 'charitable donation package' that included one or more Ban Chiang antiquities to be donated to a charitable institution.” Then “Silk Roads Design Gallery prepared false appraisals for donations of these antiquities to charitable institutions, such as museums and universities using another person’s name.” Jonathan Markell thereafter “contacted charitable institutions to get them to accept his, defendant Carolyn Markell’s, and his co-conspirators donations.” Specifically, prosecutors alleged:
“On or about December 26, 2003, CAROLYN MARKELL sent an email to a museum representative regarding the provenance of donated items as being a purchase in 1984.
Defendant CAROLYN MARKELL determined that she and defendant JONATHAN MARKELL would purchase items to be donated from a certain co-conspirator. Between an unknown date and January 2008, although defendant JONATHAN MARKELL knew that the seller of a donated item could not appraise the item for tax purposes, he prepared appraisals that falsely inflated the value of donation items he sold as part of a "donation package" he sold to co-conspirators. … In or about April 2007, defendant JONATHAN MARKELL advised an unindicted co-conspirator to change the listed purchase date on a museum donation form because it needed to appear that the co-conspirator had held the item for years, namely, ten years, to take the inflated value as a tax deduction. On or about March 10, 2006, defendant CAROLYN MARKELL contacted a museum curator to discuss the museum's policies and requirements. On or about June 14, 2006, defendant JONATHAN MARKELL solicited a Thailand museum curator's electronic signature which he fraudulently inserted on appraisals of items to be donated that he had prepared. ... On or about March 27, 2007, defendant JONATHAN MARKELL electronically mailed a request to the museum curator in Thailand to sign forms to support co-conspirators' charitable donation tax deductions and to sign six to eight blank forms in blue, to support fraudulently future donations. On or about December 13, 2007, JONATHAN and CAROLYN MARKELL delivered donations to a museum on behalf of a client. Around December 2007, defendant JONATHAN MARKELL donated Ban Chiang antiquities to a museum on behalf of co-conspirators, charging them $3,450 for the items and appraisals to support an $11,425 charitable donation income tax deduction.

Meanwhile, from 2004 through 2007, the Markells regularly donated Ban Chiang artifacts to an unidentified museum(s) and took a charitable tax deduction, “knowing the items had been stolen from the country of Thailand.”

In their steady march toward convictions and incarceration, the U.S. Attorney's Office tapped into its experience with wildlife trafficking cases—an instructive parallel to antiquities trafficking cases. Prosecutors wrote in a sentencing pleading dated Dec 3, 2015:
There are two types of archeological resource looters: (1) the looter that digs up and collects artifacts as a hobby for his or her own personal collection; and (2) the looter that digs up artifacts for the purpose of selling them to brokers or gallery operators. As with the protection of threatened and endangered wildlife species, the key to protecting and conserving archeological resources is to eliminate markets for illicit/looted antiquities. Without the existence of brokers, middlemen, and gallery owners who are willing to knowingly and intentionally profit from sales of parts and products of threatened or endangered wildlife species or looted archeological resources, there is little monetary incentive for wildlife poachers or archeological resource looters to engage in their nefarious trades.

One might be tempted to think that the archeological resource looter squatting in the deep mud and steaming jungle highlands of Ban Chiang, Thailand is primarily to blame for the devastation of pristine archeological sites and the information lost thereby—just as one might be tempted to lay the bulk of the blame for the loss of the last Northern White Rhinoceros at the feet of the poacher who killed it; but that line of thinking is incorrect. It is individuals such as Jonathan Markell ... the importers, the buyers, and the gallery owners who purchase and acquire such archeological resources or wildlife products for profitable resale who are primarily to blame for the underlying devastation. For these are the individuals who create the markets that create the monetary incentives that drive the poachers and looters into the fields.

The government's lawyers thereby laid the groundwork to argue for a prison term, “to reflect that seriousness and to promote respect for the law and to provide just punishment for the offense."

Meanwhile, they made the important point that “[a]rcheological resources are non-renewable. The looting of archeological resources causes widespread destruction of archeological sites and results in the loss of archeological information which would be gleaned from a properly excavated site."

They informed the court as well about the enormous impact of cultural plundering on the Thai people. “Many villages throughout Southeast Asia have been deprived of the opportunity to grow an economy based on archeological tourism because their heritage and archeological resources have been devastated by looting activity to supply to the purveyors of 'stolen time,' such as defendant Jonathan Markell."

Prosecutors poignantly added, "Criminal conduct, like that committed by defendant Jonathan Markell in this case, serves to deprive individuals from other countries of their own distinctive histories and heritages—in essence stealing not just their antiquities, but their 'time and history."

Two witnesses reinforced these arguments when they testified this week at the sentencing hearing. One witness was the NPS agent who investigated the case, and the other was archaeologist Dr. Joyce White, director of the Ban Chiang Project housed at the University of Pennsylvania Museum.

Dr. White analyzed more than 10,000 artifacts, mostly from Thailand, which police obtained through Operation Antiquity, the code name used by NPS, U.S. Immigration and Customs Enforcement Homeland Security Investigations, and IRS Criminal Investigation for the Museum Raids investigation.

In a court Declaration, Dr. White made clear that antiquities exported from Thailand generally require a permit from the Thai Fine Arts Department. But, remarkably, she only saw one or two samples of antiquities where a permit actually had been obtained despite the thousands of samples examined.

Dr. White also noted that most of the artifacts were found intact, indicating that they had been illegally dug-up. “Intact artifacts are rare in archaeological sites and tend to come from human burials,” which would require “large scale excavations.”

The prison term and felony convictions imposed by Judge Pregerson this week are hoped to decrease the incentive to industrially excavate overseas archaeological sites overseas and to deter smuggling of contraband cultural property into the American marketplace.

More details about the cases can be found on Jason Felch's Chasing Aphrodite blog and at Trafficking Culture.

Photo credits: William Schenold and Kiwiodyse

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & Policy Research, Inc.

Saturday, December 5, 2015

Federal Agents Easter and DiGiovanni Lauded in Heritage Trafficking Documentary

Click here to watch "The Real-Life Indiana Jones"

A new documentary lauds the hard work undertaken by Homeland Security's Senior Special Agent Brent Easter and retired Port of Newark Customs and Border Protection Officer Domenic DiGiovanni to uncover the Kapoor cultural heritage trafficking scheme.

The law enforcement officers are unsung heroes who have fought resolutely against transnational criminals who steal history and culture from abroad and then traffic their loot in the United States.

The pair have been singled out in the just released documentary titled "The Real-Life Indiana Jones," produced by ESPN's FifeThirtyEight Films.

Now we simply need specially designated federal prosecutors who will support these police investigations by indicting and convicting antiquities traffickers in U.S. courts of law.

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & Policy Research, Inc.

Tuesday, November 24, 2015

Thank You Readers! ABA Journal Names CHL to Blawg 100 for Second Straight Year

For the second year, Cultural Heritage Lawyer has been chosen as one of the ABA Journal's BLAWG 100. That is only possible because of readers like you. Thank you!

Editors of the ABA Journal announced yesterday that they selected Cultural Heritage Lawyer as one of the top 100 best blogs for a legal audience.

“For us, at the ABA Journal, this isn’t just another award. We view our annual list as service to our readers, pointing them to a collection of some of the very best legal writing and commentary on the Web.”

The ABA Journal is the flagship magazine of the American Bar Association, and it is read by half of the nation’s 1.1 million lawyers every month. The ABA is the largest voluntary professional membership organization in the world.

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & PolicyResearch, Inc.

Tuesday, November 17, 2015

Exploiting Cultural Property is an "Important Revenue Stream" for ISIS

Dr. Michael Danti testifying on Capitol Hill about ISIS terror funding.
“ISIS has developed an organized and systematic approach for exploiting portable cultural property as an important revenue stream, especially ancient antiquities.” That is the assessment Dr. Michael Danti gave to members of the congressional Subcommittee on Terrorism, Nonproliferation, and Trade this afternoon.

Dr. Danti is part of the American Schools of Oriental Research Cultural Heritage Initiatives (ASOR CHI). In partnership with the U.S. State Department, the ASOR CHI project has been investigating cultural property crimes in Syria and northern Iraq.

Rep. Ted Poe (R-TX) chaired today's hearing, titled Terrorist Financing: Kidnapping, Antiquities Trafficking, and Private Donations.

Dr. Danti pointedly remarked that “all major belligerents operating in the conflict zone engage in cultural property crimes; however, all lines of evidence indicate ISIS ranks as the most egregious and brazen offender.”

When asked what we learned from the Abu Sayyaf raid that we did not know before, Danti said that antiquities “were the functional equivalent to other resources." The military raid at a compound in eastern Syria in May killed the ISIS commander, and U.S. Special Operations Forces seized 700 cultural objects as well as documents showing that the terror group engages in antiquities trafficking.

CHL suggests that the best way to steer clear of purchasing conflict antiquities from Syria and Iraq right now is to avoid buying it.

Photo credit: House Foreign Affairs Committee

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & Policy Research, Inc.

Tuesday, November 10, 2015

Due Diligence: INTERPOL's "Most Wanted" Stolen Tapestry Found in Auction Catalog, Seized by Feds

Increasingly commoditized and always discreet, today's art market perilously tempts the black market. Reforms are needed to shine a light on the trade. For now, the marketplace must remain vigilant against money launderersterrorist financiers, and fences who peddle hot art in the cool stream of legitimate commerce.

Steering clear of stolen art requires due diligence. That means that dealers, auction houses, collectors, and associated parties actually must do the investigative diligence required so that they are not directly or indirectly aiding criminal activity. Because the art market is opaque, diligence is needed to discover an object's true chain of custody, transfer, and ownership.

The latest court case demonstrating the need for due diligence is United States v. The Tapestry Known as "The Ambassadors of Rome Offering the Throne to Numa Pomplio."

Before the tapestry surfaced last year in Bonhams' Fine American and European Furniture, Silver Folk and Decorative Arts and Clocks auction, it debuted in 2007 on INTERPOL's "Most Wanted Works of  Art" list. The auction house apparently did not discover this information before it published the piece in its sales catalog.


Bonhams richly characterized the silk and wool textile as "[a]n important Flemish historical tapestry," and suggested that it was part of the "[t]he complete set of the Life of Numa Pompilius," which can be "attributed with certainty to the painter Abraham van Diepenbeeck (1596-1675)." Auction house writers were less descriptive about the ownership history, enigmatically chronicling the chain of title with the nondescript phrase, "Property of various owners."

Prosecutors in the southern district of New York articulated a more complete description of ownership. In a forfeiture complaint filed with the federal district court in Manhattan in May, they declared that it had been stolen--along with a second tapestry--from the home of an identified man in Satiago in October 2006. Chilean investigators reported the theft to INTERPOL, and the international police agency posted the tapestry to its Stolen Works of Art Database under registration number 2007/2882-1.1. 

The United States Attorney in Manhattan wanted the stolen tapestry back to return it to the owner, so his office commenced a civil action to seize the tapestry and forfeit its title to the U.S. government. The legal pleading, verified by the FBI agent working on the case, provided sharp details surrounding the consignment and offer for sale of the tapestry, known formally as the Defendant in Rem:
On or about September 27, 2013, a private art dealer (the "Dealer"), a resident of Santiago, Chile, contacted Bonhams New York Gallery located at 580 Madison Avenue, New York, New York ("Bonhams") via email and inquired into selling the Defendant in Rem at Bonhams.  The email included a color photograph of the Defendant in Rem. 
On or about October 3, 2013, a representative from Bonhams replied to the Dealer's email and advised that Bonhams would be willing to sell the Defendant in Rem at auction with an estimated appraised value between $30,000 to $50,000. 
On or about October 7, 2013, the Dealer agreed to consign the Defendant in Rem to Bonhams in order to be sold at auction on January 23, 2014. 
On or about October 10, 2013, the Dealer mailed the, Defendant in Rem from Santiago, Chile to Bonhams' New York Gallery via DHL Express. On a DHL commercial invoice, the Dealer declared that he was exporting a "carpet" with an approximate value of "$700." 
On or about January 2, 2014, the Dealer executed a consignment agreement with Bonhams under which the Dealer consigned the Defendant in Rem to Bonhams for sale at auction. The Defendant in Rem was included as Lot 1201 in the auction catalogue (the "Catalogue") .... 
On or about January 10, 2014, Bonhams' representative emailed the Dealer advising him that they had received a request for information as to the Defendant in Rem's provenance. 
On or about January 13, 2014, the Dealer responded to Bonhams' January 10, 2014, email stating, in sum and substance, that he purchased the Defendant in Rem from an art dealer in Santiago, Chile in approximately March 2002. 
On or about February 19, 2014, agents of INTERPOL questioned the Dealer in Santiago, Chile regarding his ownership and provenance of the Defendant in Rem. In response to these inquiries the Dealer stated, in substance and in part, and in contravention of his email to Bonhams, that he had purchased the Defendant in Rem in late 2006 or early 2007 from two individuals in Santiago, Chile. The Dealer claimed that he could not state the names of either individual and that he no longer had any documentation regarding these individuals or this transaction in his possession.
The U.S. Attorney's Office accused the dealer of having "knowingly imported the Defendant in Rem into the United States knowing that it had been stolen, converted, or taken by fraud, and facilitated the transportation, concealment, or sale of the Defendant in Rem, knowing the same to have been imported or brought into the United States contrary to law."

The forfeiture pleading alleged violations of 18 U.S.C. § 545 (fraudulent importation of merchandise into the United States), § 2314 (interstate and foreign transport of stolen merchandise), § 2315 (concealment, storage, and sale of stolen property), and/or 19 U.S.C. § 1595a (introduction of merchandise contrary to law).

With the assent of prosecutors, the district court on September 8 ordered the release of the tapestry to the true owner. Today the case serves as another reminder of why conducting a meaningful due diligence investigation into an artwork offered for sale is vital.

Photo credit: Verified complaint, U.S. Attorney for the Southern District of New York

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, cultural heritage policy, art law, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Thursday, October 22, 2015

Watch Live: Monuments Men Awarded Congressional Gold Medal

The Monuments Men will be awarded the Congressional Gold Medal today. Watch it live beginning at 3 p.m. today by clicking on the video box below.

UPDATE - The broadcast is now archived in the video below. The recording has intermittent audio and video problems. Please be patient.

Senate and House leaders of both political parties will bestow Congress's highest civilian award to the team of men and women who, during World War II, sought to preserve cultural heritage from destruction.

Both legislative chambers on Capitol Hill passed the Monuments Men Recognition Act in May 2014, which the president enacted into law on June 9, 2014.




Congresswoman Kay Granger (R-TX-12) was a primary sponsor of the legislation. Some of the lawmaker's remarks to members of the House appear in the video below.



Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural heritage law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Sunday, October 18, 2015

2016 National Cultural Heritage Law Moot Court Competition: Registration is Now Open!

The Lawyers’ Committee for Cultural Heritage Preservation and DePaul University College of Law once again will host the annual National Cultural Heritage Law Moot Court Competition. Registration is now open.

Oral arguments will be held on February 26 and 27 at the United States Court of Appeals for the Seventh Circuit in Chicago, Illinois.

The 2016 Competition will focus on the Foreign Sovereign Immunities Act and other procedural issues raised by a lawsuit brought by the Acropolis Museum against the British Museum seeking restitution to Greece of the Elgin Marbles/Parthenon Marbles.

The competition is open to 26 two- and three-member law student teams The registration deadline is November 19, 2015.

Visit the competition website at go.depaul.edu/chmoot for additional details or to register a team. Contact the Competition Board at chmoot@gmail.com with any questions.

Attorneys interested in serving as judges or brief graders should contact chmootjudges@gmail.com. CLE credit is available for attorneys who participate as judges.

Photo credit: Patrik Rzezwicki

Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Thursday, October 15, 2015

Fossil Smuggler Sentenced

Microraptor fossil recovered by ICE.
Fossil smuggling has been an area of law enforcement success for Homeland Security Investigations (HSI). The investigative arm of Immigration and Customs Enforcement (ICE) rarely generates heritage trafficking cases that lead to prosecutions. But court cases against Jun Yang, Eric Prokopi and John Richard Rolater have been noteworthy exceptions.

HSI's latest achievement is a plea deal concluded by the U.S. Attorney's Office in Wyoming with Charles Magovern of Boulder, Colorado, who was convicted of fossil smuggling.

Following the terms of the agreement, a federal district court last week sentenced Magovern to probation for illegally importing dinosaur specimens into the United States from China and Mongolia.

The felony information filed by Assistant United States Attorney Stuart Healy, III charged Magovern with willfully and knowingly importing paleontological material "by means of false statements and false papers, to wit, customs import declarations ... were false and fraudulent in that they did reflect as the purchase price of said merchandise a value which was less than the purchase price of said merchandise." Magovern, along with "fossil retailer" John Richard Rolater and another conspirator, "did knowingly aid and abet each other in the commission of this offense," the information further charged. The violations constituted offenses against 18 USC §§ 542 and 2.

ICE reported that the illegal imports were concealed "within legitimate cargo."

According to a press release issued by the agency, the smuggled objects included fossils dating as far back as 151 million years. They consisted of:
Fossil
Anchiornis fossil recovered by ICE.
Part of the sentence included Magovern's agreement to forfeit "fossils already provided by the defendant" to ICE.

Magovern appears to have cooperated with authorities given his waiver of grand jury indictment, the quickness between the filing of the criminal complaint in July to the time of sentencing, and the actual terms of the sentence.

Photo credits: ICE

Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Wednesday, October 14, 2015

Full Video: $5 Million Reward Announced at Conflict Antiquities Symposium Focused on ISIS Terror Funding

Evidence seized during a raid in May by U.S. Special Operations Forces on the compound of an ISIS leader shows that the terror organization engages in antiquities trafficking. The cultural objects recovered from the raid, in part, prompted CHL to post "Steering Clear of ISIS Loot: Don't Buy, Apply Strict Due Diligence."

Last week at the Metropolitan Museum of Art in New York City, the State Department revealed more direct evidence acquired from that raid and announced a reward of up to $5 million dollars for credible information leading to the significant disruption of the illegal trade in antiquities that benefits ISIS.

Robert Hartung, Deputy Assistant Secretary for Diplomatic Security and Assistant Director for Threat Investigations and Analysis Directorate, announced the reward at a symposium held on September 29 and titled "Conflict Antiquities: Forging a Public/Private Response to Save the Endangered Patrimony of Iraq and Syria." Video of that symposium is now available and can be watched below.


Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Tuesday, October 6, 2015

State Department Extends Cultural Property MoU with Nicaragua Despite AAMD Opposition

Earlier this year the Association of Art Museum Directors (AAMD) shifted its stance on bilateral agreements authorized by the Cultural Property Implementation Act (CPIA) when the group decisively opposed the renewal of U.S. import restrictions covering endangered archaeological material coming from Nicaragua. The State Department disagreed with the AAMD, and today backed a fresh memorandum of understanding (MoU) that extends these protective trade barriers for another five years.

Writing in opposition to Nicaragua's petition for a rejuvenated MoU, the AAMD argued in January that the Central American nation "simply fails to protect its own cultural property in the manner required by the CPIA."

The CPIA is the federal law that authorizes the enactment of heritage protection measures consistent with the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property.

"Refusing to extend the MOU could be the very wake-up call Nicaragua needs to undertake real and substantial efforts at a critical time in its history," the AAMD contended in a statement submitted to the Cultural Property Advisory Committee (CPAC), the group that reviews MoU requests.

The State Department's Assistant Secretary for Educational and Cultural Affairs, however, "determined that factors continue to warrant the imposition of import restrictions and no cause for suspension exists," the Federal Register reported. "Accordingly, these import restrictions will remain in effect for an additional 5 years, and the CBP [Customs and Border Protection] regulations are being amended to reflect this extension until October 20, 2020."

The import controls cover pre-Hispanic artifacts including ceramics, vessels, statues, mace heads, jewelry, and more. Similar barriers were first erected fifteen years ago in an effort to deter the looting of archaeological objects.

Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Wednesday, September 30, 2015

Antiquities Trafficking Investigation Reveals Suspected Ties to Terrorism and Money Laundering -- "Seize and Send" Outcome Flags Need for Special Prosecutors

cultural heritage law enforcement and prosecutions
ICE returned smuggled antiquities to Afghanistan
during a photo-op held in Washington, DC in 2013.
No prosecutions resulted from the case.
Newly obtained documents released by Immigration and Customs Enforcement (ICE) reveal that ICE Homeland Security Investigations (HSI) investigated a suspicious shipment of cultural heritage objects imported into the United States, but no prosecutions resulted.

In 2011, U.S. Customs and Border Protection (CBP) and the HSI New York El Dorado Task Force (EDTF) seized a falsely labeled package that bore the hallmarks of antiquities trafficking. ICE investigators voiced concern about the possibility of money laundering, ties to terrorism, and how the same importers already had been involved in previous investigations. Meanwhile, they openly spoke about artifacts pouring out of Afghanistan and Pakistan. Authorities seized the goods because of violations of federal law, including the commission of felony crimes.

Yet the investigation produced no arrests, no indictments, no prosecutions, and no convictions even for those who lied on the customs forms. In fact, the newly released documents confirm that no prosecutor was assigned to the case.

ICE is the investigative arm of the Department of Homeland Security (DHS). It is tasked with conducting criminal investigations; combating transnational crimes that exploit legitimate trade, travel and financial systems; enforcing the customs and immigration laws; and protecting the nation against criminal and terror organizations. HSI was formed in 2010 through the unification of ICE's former Offices of Investigations, Intelligence and International Affairs.

While the police agency routinely announces numerous arrests and prosecutions in cases ranging from child exploitation, illegal narcotics, human trafficking, financial crimes, contraband cigarettes, and more, ICE rarely generates criminal prosecutions in cultural property cases.

CHL readers will recall, for example, the highly publicized return of an Assyrian limestone head fragment earlier this year when ICE ambiguously reported "one arrest" related to Operation Lost Treasure--a police program focused on antiquities smuggling--but announced no arrests, indictments, prosecutions, or convictions connected with the illegal importation of the $1.2 million head from Iraq. The object had been brought to the United States illegally in 2008 from the United Arab Emirates.

This "seize and send" policy is starkly revealed in ICE's 2011 antiquities trafficking investigation, the details of which have now been revealed by documents disclosed under the Freedom of Information Act (FOIA). CHL filed the FOIA request in September 2013.

ICE's investigation was part of the touted Operation Lost Treasure program. In place of grand jury indictments, ICE held a photo-op ceremony in Washington, DC in September 2013, returning the evidentiary fruits of its investigative work to Afghanistan.

The carefully redacted and cherry-picked documents released on July 31, 2015 show that authorities intercepted a small shipment passing through New Jersey's international airport during March 2011. The package contained a pitcher and ancient gold objects, and HSI had reason to suspect a link to terrorism.

After the shipment arrived at the Central Air Cargo Examination Facility (CACEF) at Newark Liberty International Airport, CBP notified the HSI Special Agent in Charge New York (HSI SAC/NY), "requesting assistance with the importation of possible smuggled cultural property via express consignment (Fed Ex)," according to a police report dated April 21, 2011.

The customs paperwork accompanying the package obscurely declared, "Brass Jug, Plated Pendants, Unmanifested Gold Pieces" from Great Britain. "No Antique Statement nor provenance supplied," a CBP officer noted.

According to a document titled "Case Agent Cultural Property Art and Antiquities Repatriation Checklist," the import consisted of more than simple housewares and jewelry from England. Instead, there were cultural heritage objects that included:
Oinochoe seized by ICE and sent to Afghanistan.
1. A late Roman oinochoe, or wine pitcher, 5th-8th century A.D. of ovoid form with reeded body and central band of figures within arched reserves, shaped handle Height 4 (sic) 
2. Three (3) Scythian gold repousse, foil appliques. 5th century B.C., each depicting Antelopes. Height of each: 4 inches. Width of each: 3-1/4 inches 
3. Two (2) antique coiled gold ornaments, possibly 17th century. Height of each 3.8 inches. Weight of each: 2 ounces (approximate)
Authorities retained an appraiser who found that the retail values of the objects totaled $29,000 USD, almost 30 times greater than the trifling £650 GBP ($1,048.94 USD) claimed by the importer on the customs paperwork.

The objects had been devalued significantly, probably to bypass the formal customs entry, the kind of entry typically used when importing goods for commercial or resale purposes and the kind of entry that would have required more oversight. The importer likely knew that devaluing the objects below $2000 would cause the shipment to be less eye-catching. The value threshold today for an informal customs entry is $2500.

According to the appraiser, the values that should have been listed on the customs form were:
  • Oinochoe, Fair Market: $4,000; Retail: $8,000
  • 3 Gold Repoussé, Fair Market, $6,000; Retail: $12,000
  • 2 Gold Ornaments, Fair Market, $6,000; Retail: $9,000
A federal investigator confirmed, "It is ... suspected from prior case experience ... that this shipment is being imported improperly as an informal entry versus a formal entry. ... Cultural Property smugglers often utilize this tactic to avoid having their express consignments garner added scrutiny. Formal entries are required to have Harmonized Tariff Schedules, proper provenance or affidavits, invoices, shipping documentation, etc. The failure to provide adequate paperwork also makes this shipment subject to seizure and forfeiture according to 19 CFR 145.11 and 145.1218 USC 54218 USC 54519 USC 1595a (c) 1(a)." Such forfeitures are predicated on individuals committing illegal conduct, especially prosecutable crimes.

An email sent by the CBP Supervisory Officer assigned to Newark Liberty International Airport and dated April 22, 2011 explained that officials actually seized two shipments in March 2011. In addition to the oinochoe and the gold objects, which the customs officer initially believed to have been from the first century, authorities seized Iranian artifacts:
On April 21, 2011 Officer from CACEF-FedEx/UPS along with Special Agents from SAC/NY, El Dorado Task Force (EDTF) Financial Group VI seized two cultural property shipments. 
In one shipment UPS officers targeted and examined a shipment listed as ''Antique Decorative Persian Metalwork". Research by CBPO ... and ICE SA ... determined that the items were from around the 12th century and the actual origin of the shipment to be Iran. The items were being shipped in violation of the 1987 United States Executive Order 12613 imposing an import embargo on Iranian origin goods and services.
In the second shipment FedEx officers targeted and examined a shipment coming from Great Britain that was manifested as "BRASS JUGS PLATED PENDANTS". 
Examination of the shipment revealed a brass jug, gold colored embossed plates and two gold colored pieces. Research by CBPO ..., ICE SA ... determined that these items were being brought in with a false country of origin, undervalued and were from approximately 100 B.C. These items were seized for being violation of 18 USC 545 - Smuggling Goods into the United States." 
Supervisory Special Agent  
Intellectual Property Art and Antiquities Investigations 
Department of Homeland Security
The released documents reveal nothing further about the Iranian objects.

With regard to the shipment containing the jug and gold items, not only did the importer provide bogus descriptions and phony values on the customs paperwork, the importer also misleadingly claimed that the goods originated from Britain. Because the package had been shipped from the Walthamstow neighborhood in London, the importer probably hoped that he could get away with this misrepresentation.

An April 21, 2011 investigative report expounded on this legal violation. "On April 18, 2011, the SME [subject matter expert] further elucidated that none of the items in this shipment could have had Great Britain as a country of origin." As a result, the report recorded that "[t]his importation contained a material false statement related to the country of origin," It pointedly added, "Individuals who smuggle cultural property often utilize false countries of origin to avoid Customs scrutiny in order to import controlled antiquities. Listing a false country of origin is a violation of 18 USC 542 (Material False Statement). If this shipment was destined to an antiquities dealer, they should know and would be responsible to know the country of origin. In this instance [it] is suspected that the false country of origin listed as Great Britain was a known false statement and a violation of 18 USC 545 (Smuggling). The shipment would be subject to seizure under 19 USC 1595 a (c) (Introduction Contrary to Law)."

The oinochoe and gold pieces were supposed to be delivered to a man living in New York City who resided at the same address as a registered New York corporation, referred to here simply as "Bactrian Global Enterprises" (BGE). DHS investigative report number 20 dated October 11, 2011, classified "BGE" as "a business that is suspected of antiquities smuggling and money laundering."

Concerns about smuggling, money laundering, and ties to terrorism almost certainly should have prompted a prosecutor to be assigned to the case. But the documents released by ICE reveal that no prosecutor was assigned. Whether ICE failed to ask for one or whether a U.S. Attorney's Office declined to assign one is unknown. What is known is that no prosecuting attorney was attached to a case flagged as one involving transnational felony conduct. A May 9, 2011 reply to an email sent a few days earlier from a chief CBP paralegal in the Office of Fines Penalties & Forfeitures explicitly confirmed that no attorney had been designated. The Paralegal Specialist asked if there was an Assistant U.S. Attorney involved. "No AUSA" was the dispiriting reply given.

By way of contrast, wildlife trafficking crimes, which are typically investigated by special agents of the U.S. Fish and Wildlife Service (USFWS), have designated prosecutors at the Justice Department's Environmental Crimes Section (ECS) available for consultation. Following the best practice of assigning a prosecuting attorney to a serious or complicated felony-level investigation, the Justice Department points out, "An ECS prosecutor often gets involved early in an investigation, such as when the investigator swears out a search warrant or when a grand jury’s investigative power is needed.  Once the necessary evidence is collected, the prosecutor presents the case to the grand jury for indictment. After indictment, the prosecutor guides the case through complex white collar and environmental law issues and prepares it for trial." ECS prosecutors also partner and coordinate with front-line prosecutors based at U.S. Attorneys' offices.

Repouseé gold foil applique depicting antelope
seized by ICE and sent to Afghanistan
Because ICE failed to arrest, indict, prosecute, or convict any individuals connected with the 2011 investigation, CHL will not identify the names of those who imported the cultural heritage objects or disclose the specific address where the shipment was bound.

With that said, ICE agents paid a visit on September 16, 2011 to the Manhattan address of "BGE" on the pretense of hand-delivering a property seizure notice prepared by a paralegal specialist four days earlier. Delivering it "would be a perfect excuse for an interview," a September 2, 2011 email divulged.

Two federal agents arrived at the Chelsea residence and found an unassuming building, the kind of four-story low-rise that New Yorkers walk by each day and never take a second look. Inside were unspecified antiquities. An agent summarized the encounter in a report dated October 11, 2011. (ICE redacted references to any names in the original report):
On September 16, 2011, Special Agents [   ] and [   ] conducted an interview with [   ] located at [BGE] located at [   ] New York, NY 10011. The interview contained but was not limited to the following topics of conversation: Special Agents [   ] identified themselves [   ] and asked permission to enter… Permission was granted and agents observed the address to be a basement level apartment of approximately two large rooms. One room was set-up as a residential space where two people appeared to be living. The second room appeared to be a large storage room with a computer. Stored in the room there appeared to be large quantities of crafts, jewelry and antiquities. [   ] stated that he lived at the address with his cousin and that the apartment was the location of a jewelry and craft business, and a real estate business. … [   ] relayed that he and his father are in the business known as [BGE] together and he was able to produce a business card attesting to this fact. The card also listed [   ] the cousin living at the address, as an employee of [BGE]. [   ] explained that the business is set-up to predominantly sell costume jewelry and textiles. 
SA [   ] stated he was there to deliver a seizure notice regarding an importation previously destined for [   ] at the address. [   ] stated that he was aware of it but that only his father knows about that specific shipment. [   ] stated that the merchandise for [BGE] comes from Pakistan. When asked specifically where the antiquities come from [   ] interrupted the conversation and stated that the antiquities were all from central Asia. [   ] was able to provide that their Customs Broker's name is [   ]. [   ] also stated that the shipment was sent to his father to sell on consignment and that his father didn't know much about it. SA [   ] explained to [   ] about the seizure notices and the accompanying paperwork and had him sign a sheet acknowledging receipt of the hand carried mail.
That no one knew anything of consequence is a fair summary of this same interview as memorialized by an HSI special agent's supplemental email dated October 5, 2011:
• He and his father are in the business together. They sell costume jewelry and textiles. 
• The father is the one that knows about the shipment.
• He did not know anything about the shipment.
• [   ] is their [customs] broker.
• There was another individual that was a real estate business partner of the father but not with ["BGE"]. Subject name was [   ] unknown proper spelling.
• [   ] stated that the shipment was sent to sell on consignment and that the father didn't know much about it."
Shortly after the interview, and for reasons not explained in the released documents, government information networks rang with alarm. Documents confirm that on Wednesday, October 5, 2011 computer terminals at U.S. border entry points flashed warnings over the Treasury Enforcement Communications System (TECS):
 
"INDIVIDUAL IS SUSPECTED OF DEALING IN ILLICIT CULTURAL PROPERTY DETAIN ALL SHIPMENTS AND IF ENCOUNTERED CONTACTED CASE AGENT...."
"BUSINESS IS SUSPECTED OF DEALING IN ILLICIT CULTURAL PROPERTY BEING SMUGGLED FROM AFGHANISTAN AND PAKISTAN. PLEASE DETAIN ALL SHIPMENTS AND CONTACT THE CASE AGENT...."

Before HSI agents actually conducted their interview in Manhattan, they made an effort to secure a search warrant for "BGE." But they never got one. That likely sparked the idea of serving the property seizure notice as a justification for visiting the importer.

Interestingly, ICE went outside the jurisdiction for help with getting a search warrant. Based on the both the substance and style of a conversation archived in an email string sent on the afternoon of May 10, 2011, one unidentified party, who could be an investigative agent based in the jurisdiction of the Southern District of New York (probably Manhattan), and the other unidentified party, who could be a federal prosecutor in the Eastern District of New York (probably Brooklyn), spoke about the matter.

The email string revolves around a request for an email search warrant. The presumed agent wrote that he or she learned that the suspect(s) already had been investigated for possible terrorism ties to Afghanistan, smuggling, and money laundering. Those cases were closed, and now there was a request for a fresh warrant. The emails offer the following exchange:

Agent: "I received this email a couple of months ago from a source and the pieces being offered are straight out of the ground. I recently seized a package in Newark destined for the address of ["Bactrian Global"] but the ultimate consignee was [    ]. When I inspected the shipment in person, the box (not the shipping label) was addressed to [   ] the principle behind ["Bactrian Global Enterprises"].

"The shipment was seized because it contained a false C/O [country of origin], and contained golden antiquities that were not declared. The shipment was seized on 4/21/2011.

"Would this all be recent and good enough for an email S/W [search warrant] in your opinion? If so, would you do it or could you recommend someone? I can send the ROI [report of investigation] related to the seizure and pictures if interested."

Prosecutor: "Is there any connection to the EDNY [Eastern District of New York]? How much do you think these pieces are worth? True CDO [country of declared origin]?"

Agent: "True C/O [country of origin] is most likely Iraq or somewhere in the middle east[,] the expert couldn't give one country 100% but she was 100% certain it was not GB [Great Britain]. Attached is the report. No estimate on value yet, but we are pretty certain it is more than declared because they failed to declare much of the shipment.
"Just learning that the principles (sic) have prior (failed and closed) investigations into them for money laundering, Cult. Prop. [cultural property] smuggling, and possible terrorism ties to Afghanistan.
"Does the same source who worked the UC op [undercover operation] that took place via JFK [Airport in New York] work [in order to form some legal tie to the Eastern District of New York]? Also, most of their shipments are via JFK. This one wasn't but it also used the wrong name on the shipping label."

Prosecutor: "I don't think we have venue here... I hate that there's dirt caked on them. Though it's so dirty, it makes you wonder if they're trying to increase value by faking a find."

Under the circumstances, a search warrant probably was not issued from the Eastern District of New York because the suspects were located in Manhattan, in the Southern District of New York. A specially assigned heritage trafficking prosecutor based at the Department of Justice in Washington probably could have facilitated this search warrant request by coordinating with the right U.S. Attorney's office. But no such specialist prosecutor exists.
So what looked like a criminal investigation into antiquities trafficking quickly turned into a seize and send case. Instead of holding the evidence and building the investigation for possible grand jury review, indictment, and conviction after trial or plea, ICE sought title to the antiquities through the forfeiture process, eventually sending the cultural heritage objects back to their country of origin. This seize and send disposition effectively terminated any chance of successfully prosecuting those responsible for lying on the customs entry paperwork.
 
An email dated January 25, 2012 from a Supervisory Legal Specialist at CBP 's Office of Fines, Penalties, and Forfeitures touched on this administrative process: "Please be advised that the cultural property in FP&F Case #: [   ] associated with OI #: [   ] has been administratively forfeited. I have attached the appraisal conducted on the seizure of this merchandise so you can determine the repatriation of these items to their rightful nations as per the seizure narrative of this case."

"Please send the seizure notice and Hold Harmless to [   ] Cultural Attache[,] The Embassy of Afghanistan...," requested an HSI SAC/NY special agent in an email dated April 5, 2013.

How Afghanistan and not Iraq or Pakistan came to be identified as the true country of origin remains unknown from the FOIA-released paperwork. Iraq had been mentioned as a possible country of origin in the police reports, and a special agent from HSI SAC/NY mentioned Pakistan in an email dated April 4, 2013, which pointed to the smuggling problem originating from South Asia. "You should see how much Afghan and Pakistani material we have from the [   ] case," the agent exclaimed. An unclassified but redacted email dated April 2, 2013 by an unknown government official echoed this troubling sentiment, "So much material is flowing out of Afghanistan and Pakistan; it really is a shame."

Although the repatriation essentially concluded the case, one undated document from HSI's Office of International Affairs insisted on the continuing nature of ICE's probe:
HSI New York's Operation Lost Treasure is an ongoing investigation targeting an organization smuggling items of world cultural heritage into the United States. The objects enter the antiquities market and the proceeds are laundered. Antiquities have been traced to Afghanistan, Iraq, Greece, Italy, Egypt and Iran and the funds have been traced to Dubai and London. To date, approximately 50 objects have been recovered with an estimated value of $2.5 million.
Whether ICE has probed this four year old case recently is unknown. What is known is that, according to NYS Department of State Division of Corporations Records, "BGE" today lists its principal office on the Upper West Side in New York City. "BGE," formed in 2006, is listed in the Yellow Pages as a home furnishings business that provides arts and crafts supplies. The company is a likely outgrowth of a preceding import/export company begun in the 1980's and now dissolved. Persons connected with "BGE'" and the 2011 investigation appear to use aliases that are subtle variations of their names, and the Manhattan address where HSI agents once visited currently houses at least four registered real estate corporations and an unregistered soft drink/grocery business, according to open source records. As of last month, an apparent relative of "BGE's" owner appears to have formed a brand new company at that address, which seems to be in the same type of business as"BGE."

HSI Assistant Director John Connolly emphasized during the repatriation ceremony of the artifacts to Afghanistan how HSI is "beating back this illicit trade through dedicated law enforcement efforts." But such a declaration remains inconsequential so long as crimes are committed and no perpetrators are brought before the courts. The participation of prosecutors are needed to do that. A designated group of specialist prosecutors working with HSI on their investigation may even have averted another "failed and closed investigation[]," as ICE put it, of cultural property trafficking.

Wildlife trafficking investigations should serve as a model for cultural heritage trafficking prosecutions. Because successful inroads have been made to combat this transnational crime, now more is being done. For the last five years, specialist prosecutors at ECS and their counterparts across the globe have been supported in their mission by the International Consortium on Combating Wildlife Crime (ICCWC), a group of five international organizations--including INTERPOL and the World Customs Organization. The ICCWC's mission is "to usher in a new era where perpetrators of serious wildlife and forest crime will face a formidable and coordinated response, rather than the present situation where the risk of detection and punishment is all too low." USFWS notes that the consortium "was formed to increase prosecution and punishment for caught smugglers and poachers."

Cultural heritage traffickers need to be prosecuted and punished too, and the inside look into ICE's 2011 seize and send case illustrates the point.
Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch CulturalHeritage Law & Policy Research, Inc.