ROME — Gioacchino Campolo, Italy's video poker king, loved art. Among the 300 million euros worth of goods confiscated from him were about 100 very valuable works of art: paintings by Salvador Dali, Giorgio Morandi, Renato Guttuso, Mattia Petri, and Giorgio de Chirico.
Collections in the tens of millions of euros were also confiscated from: Nicola Schiavone, son of Franceso Schiavone, boss of the Casalesi clan within the Naples-based Camorra crime syndicate; and from Gianfranco Becchina, art dealer to Matteo Messina Denaro, boss of Sicily's Cosa Nostra.
Let's not, of course, forget the two Van Gogh oil paintings — Congregation Leaving the Reformed Church at Nuenen and View of the Sea at Scheveningen — which were stolen in 2002 from the Van Gogh Museum in Amsterdam and later found by Italian financial crime unit officers in Castellamare di Stabia, Naples, in a cottage linked to drug trafficking kingpin Raffaele Imperiale.
And then there are the 'Ndrangheta investments in 17th-Century paintings in Lombardy, and the collections of Gennaro Mokbel and Massimo Carminati, active figures on the piazza of Rome, at the center of the must-see documentary Follow the Paintings by Francesca Sironi, Alberto Gottardo and Paolo Fantauzzi.
Are criminals and mafia bosses really this passionate about art? Hard to imagine. More likely it's a sign of just how much the art market has become a phenomenal money laundering and investment tool for organized crime. It's a sector that allows dirty money to be hidden, safe and sound, with a guaranteed protection against devaluation over time.
And this isn't just about laundering. Artwork offers the certainty of an investment that won't have inflationary repercussions, and with a guaranteed return to boot, provided the money is invested in masterpieces destined to securely maintain their value over time.
Van Gogh's oil painting View of the Sea at Scheveningen which was stolen in 2002 — Photo: BuyEnlarge/ZumaPress
The global art market is worth between 58 and 60 billion euros. It's a worldwide boom that doubled in size in the last 10 years, and which shows no sign of imploding. And not just thanks to those evergreen works, the masterpieces. It's also due to the exponential rise in prices for works by skyrocketing young artists, pieces that can in some cases top $100 million. All anomalies, according to experts in the sector.
In the past decade, galleries and auction houses have beat record after record, succeeding in placing both masterpieces and works by artists launched from semi-anonymity to worldwide commercial success.
It's a sector that has benefited from an absolute lack of regulation.
But not all that glitters is gold, because passionate collectors aren't the only ones driving the market's wild expansion. Also fueling the frenzy is the ease with which mob interests have so far been able to use this commercial bubble to recycle illicit funds. We're talking about a sector, in other words, that has benefited from an absolute lack of regulation.
"It's a flow of cash coming above all from the drug trade," explains Gen. Allesandro Barbera, commander of Scico, the central investigative service on organized crime of the Guardia di Finanza.
Roughly 18 billion euros (or 1% of Italy's GDP) is the colossal value of real estate and goods confiscated by the Italian financial authorities from criminals between 2015 and 2019. Seizures that confirm the importance of what is seen as a strategic choice of the mob to invest in safe-haven assets: principally diamonds, precious metals, paintings and archeological finds.
These treasures aren't all stolen. Many are acquired legally on the art market, above all at auction.
"The mafia enterprise moves indiscriminately between the two words, legal and illegal, which makes it particularly tricky," Barbera explains. "For the clans, safe-haven assets like works of art are desirable because they are convenient. It's a business with branches all over the world, very difficult to reconstruct. We find ourselves constantly facing a two-faced Janus, and it requires ever more sophisticated investigative techniques to find where the illicit funds are hiding, and to map out all the money transfers."
Barbera adds: "When you find yourself facing a mafia organization that moves in the legal art market, you don't need sharpshooters so much as business-minded investigators who know how to read financial statements."
Works of art and safe-haven assets, he explains, are today's "cashier's checks: exchange goods with stable value and a double advantage — masking the provenance of the investments, and guaranteeing the availability of the good in real time on the global market."
They are like trophies to exhibit as demonstrations of power.
The criminal chain operates, furthermore, like a value chain that, in its various phases, succeeds in raising and sustaining a constant growth in value.
Investigators have also succeeded in documenting a "reverb effect" enjoyed by the chief clans that own artistic masterpieces with universally recognized value. The extremely coveted items are trophies to exhibit as public demonstrations of power, prestige and dominion over their territory.
"For a mafia boss, having a painting or a sculpture by a major artist at his disposal is not just a money-laundering scheme. Being able to exhibit a masterpiece confers prestige and reputation," the general says. "It contributes to spreading the idea of supremacy that a hegemonic group wants to express in a geographic area, or an in a specific sector of illicit traffic."
Thus the possession of art becomes a sign of power and socio-cultural investiture. A status symbol. It's a well-oiled machine. Over the years, the clans have perfected the methods of hiding money trails coming from drugs and various other rackets and trades.
"Organized crime, in its different expressions, have an interest in investing in goods that can help hide their net worth," says Federico Cafiero De Raho. "Works of art with astronomical values are thus used as instruments to safely deposit huge sums of wealth."
And with a specific advantage for clans. "These investments in paintings, sculptures and archeological treasures effectively cover up the economic entity concentrated in the object," he adds.
A way, then, to muddy the waters, to not give any certainty as to how much illegal money has been laundered along the successive gears of the "artistic laundry machine." The price of an artwork remains secret. To determine how valuable it is, one must turn to a market that is based on subjective valuations.
The national anti-mafia prosecutor reconstructs a constantly updated case study that points unequivocally to a method of hidden payment via art. In hundreds of cases, in fact, paintings, sculptures and frescoes guarantee money transfers from one mafia group to another, protected from any risk.
With a piece of paper, with a private agreement, an exchange of virtual currency is implemented and secured between criminal organizations without a single masterpiece, and in some cases even entire art galleries, needing to be transferred from one location to another.
The artwork remains where it is kept — perhaps in a free port or duty-free zone, inaccessible to all — and passes from one buyer to another.
And this is one of the new frontiers on which attention is being focused, by investigators and legislators. Meanwhile, the fifth directive of the European Union on anti-money laundering imposes on art sector operators the same regulations of transparency currently applicable to banks, notaries and accountants.
A first step toward transparency.
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