By KEVIN NELSON
March 11, 2010
Do forgers and fraud artists sell their fake goods at charity auctions? I was asked this question by a reader who had bought a signed 1932 Babe Ruth and Lou Gehrig baseball at a charity auction and was appalled at the idea that it could be bogus.
“I bought this in good faith (it was a charity auction after all),” she wrote me in an email. “I had no reason to even question it.” Then she sold it to an auction house, which did indeed have reason to question it. The auction house submitted the ball to an authenticator and “it failed,” she told me gloomily.
Now the auction house has returned the ball to her and wants its money back. The woman is perplexed and now, suddenly, suspicious. She is not a collector and knew little about the authentication process before getting tangled up in this mess.
Without even seeing a picture of it, I told her that almost certainly the ball was bad. But how could that be-she bought it at a …charity auction! I suppose it is of little consolation to her to realize that she is hardly alone. Unsuspecting, well-intentioned Americans buy fake-signed merchandise at charity auctions all the time, all across this great and benevolent land.
Do the charities and nonprofit organizations know what they are peddling? No, likely they do not. Like this woman, the good-hearted people who put on these auctions are typically not collectors and innocent of the wolfish ways of counterfeit dealers. So, too, are the equally good-hearted souls who bid on these fakes, often paying an above-market price because they wish to support the good cause being funded by the auction. They likely think the autographs are legitimate as well.
And they may be. Not every signed piece of merchandise sold at a charity auction is a fraud, of course. But these auctions are a time-honored method for counterfeit dealers to move merchandise, and lots of it. The dealers may receive a percentage of the price of the items sold. They may receive tax deductions for their donations. They may get a tax deduction and make money. Through their gifts they may also come to be viewed by the charity as community benefactors, noble and selfless givers, although in reality they may only be crooks.
Kevin Nelson is the author of Operation Bullpen: The Inside Story of the Biggest Forgery Scam in American History. Contact him here.