Manhattan-Based Art Dealer Charged in Manhattan Federal Court with $4 Million Fraud

Preet Bharara, the United States Attorney for the Southern District of New York, and Janice K. Fedarcyk, the Assistant Director in Charge of the New York Office of the Federal Bureau of Investigation (“FBI”) announced charges today against ROBERT SCOTT COOK, a Manhattan-based art dealer, for defrauding one of his clients out of more than $4 million worth of art including works by Pablo Picasso, Edouard Manet, Henri Matisse, and Pierre-Auguste Renoir.

Manhattan U.S. Attorney Preet Bharara said: “Robert Cook portrayed himself as a responsible art dealer, but the allegations here paint a very different picture. As alleged, instead of acting as an agent on his client’s behalf as promised, Cook sold the works of art behind his client’s back. Cook’s charade has now come to an end.”

FBI Assistant Director in Charge Janice K. Fedarcyk said: “Selling millions of dollars worth of someone else’s art collection and keeping the proceeds is effectively the same as stealing millions of dollars of the collector’s money. Both are forms of theft, plain and simple. The allegation of the complaint is that Mr. Cook is a crook.”

The following allegations are based on the complaint, which was filed today in Manhattan federal court:

COOK was the principal of Cook Fine Art, LLC, a gallery located on Madison Avenue in New York, New York. From 2005 to 2011, COOK engaged in a scheme to defraud one of his clients (the “Collector”) by selling 16 works of art owned by the Collector without his knowledge. The artwork, which was worth over $4 million, included watercolors, drawings, photographs, and other artwork by artists including Picasso, Manet, Matisse, Renoir, Wassily Kandinsky, and Paul Klee. COOK sold this artwork to various galleries and auction houses for $4,293,270. He failed to give the proceeds of those sales to the Collector, and lied to the Collector about the status of the art. COOK kept nearly all of the proceeds, except for approximately $100,000 that was paid to galleries as commissions.

COOK also told the Collector that he would submit a number of the Collector’s works for sale at a June 2011 auction, but never did so. In fact, COOK had already sold at least six of the works years before and kept the proceeds—which totaled nearly $2.4 million—for himself. Although COOK told the Collector that the auction had been a success and that the Collector’s works had sold for more than $5 million, COOK never paid the Collector a single dollar.

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COOK, 62, of New York, New York, faces a maximum term of 20 years in prison, a maximum term of five years of supervised release, and a fine of the greatest of $250,000, or twice the gross pecuniary gain derived from the offense or twice the gross pecuniary loss to the victims.

Mr. Bharara praised the investigative work of the FBI.

This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney Jason P. Hernandez is in charge of the prosecution.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.