Art Collectors Need To Worry About Nazis' Art Thefts

NEW YORK--The wholesale theft by Nazis of Europe's art treasures still haunts collectors today, and buyers still need to perform due diligence before purchasing any works or risk losing their investment, an insurance company executive said.

Problems with the provenance of European works were spotlight at a screening of the documentary film "The Rape of Europa," about the wholesale looting of works of art from the Jewish community by the Nazis before the start of World War II, and later looting from families and museums in occupied lands.

The screening and a panel discussion were sponsored by The Inland Marine Underwriters Association, the law firm Withers Bergman, LLP, and Warren, N.J.-based insurer Chubb Group.

Describing how the Nazis stole thousands of works before and during the war, the film detailed how bogus transactions were created to justify and authenticate ownership of the works by officers of the Third Reich.

During the war the U.S. Army detailed artists, historians and other experts to units to save and collect works of art in occupied countries. The officers with these units were stunned to find huge castles and mines filled with important works of art stolen from around Europe and Russia. Their job was to identify the owners and return the works to their rightful place.

While much was returned, ownership of some pieces could not be determined and efforts are continuing today to find the rightful heirs. However, thousands of works still remain missing and continue to turn up on occasion.

Lynn H. Nicholas, author of the book the movie is based on, "The Rape of Europa: The Fate of Europe's Treasures in the Third Reich and the Second World War," said it still remains difficult to know how many works were taken, and pieces are still appearing today, either at art markets or discovered in museum collections.

She said strong claims will be honored by museums, but the institutions will not easily give up the works because they have been victims of too many specious claims in the past.

Dorit Straus, Worldwide Fine Arts manager at Chubb and chairwoman of the IMUA, who moderated the discussion last night, told National Underwriter that for art buyers insurers only cover damage to works, not a financial loss when the rightful owner secures the return of a stolen article.

Due to the amount of Nazi plundering, it will be generations before all of the stolen works turn up, she noted, making it all the more important for buyers to thoroughly research ownership before purchasing fine works of art.

While there is no insurance that covers the financial loss if pieces turn out to be stolen and are returned to their rightful heirs, Chubb does offer art title defense coverage, noted Ms. Straus.

The insurance provides defense costs should a claim be made against an owner, at least guaranteeing the policyholder that he or she will be represented well, she said. It also offers a due diligence service to research the provenance of a work.

She stressed, however, that it is up to the buyer to do the right thing and do the research, not only to clear the conscience, but also to remove any impediments should the buyer wish to sell or bequeath the work in the future.