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Warring New York dealers guilty of tax evasion

Court orders Helen Fioratti and James Sansum to repay huge sums

A feud between two New York dealers has resulted in both admitting tax violations in court and receiving orders to repay large sums of money.

Helen Fioratti, the 74-year-old owner of L’Antiquaire and the Connoisseur gallery in the Upper East Side, has been sentenced to pay $635,000 in back taxes and a $15,000 fine. James Sansum, a former member of her staff, was sentenced to pay $58,000.

Mr Sansum, 39, worked for L’Antiquaire for 12 years from 1989 to 2001, until he left to set up his own gallery. Shortly afterwards Ms Fioratti accused him of grand larceny, criminal possession of stolen property and embezzlement. If found guilty of these charges, he could have been sentenced to 15 years in jail.

Mr Sansum was charged with the theft of $568,000 in art, antiques, books and cash in June 2003. But according to the office of the Manhattan district attorney Robert Morgenthau, Mr Sansum was given a reduced sentence for cooperating with investigators. His evidence resulted in Ms Fioratti being charged with tax evasion between 1999 and 2004.

“On numerous occasions,” according to the district attorney’s press release, “Fioratti and the corporation sent worthless items, like catalogues, to out-of-state addresses to create records making it appear that the art itself was shipped out of state, all the while allowing the customers to have the actual works sent to their residences within New York.” This allowed the company to avoid paying state sales taxes.

Mr Sansum did not get off entirely scot free. It transpired that while he was with Ms Fioratti’s gallery he was paid a salary of only $18,200, but lived rent free in an apartment in the gallery. He billed expenses including Gucci clothing to the company as part of his compensation and purchased art from the gallery. Investigators said that these should have been declared for tax purposes. The Manhattan Supreme Court sentenced Mr Sansum to pay $58,000 in back taxes and serve three years’ probation.

A number of works of art are still contested by the two parties, and the court is holding 20 of the disputed works of art.

Mr Sansum has brought a separate civil suit against Ms Fioratti demanding that she pay back his 6% share in her gallery. Meanwhile she has filed a victim impact statement with the court, asking it to jail Mr Sansum and return all of the disputed works of art. “We are fully expecting all of the art will be returned to L’Antiquaire,” says Michael Miller, her attorney.

Originally appeared in The Art Newspaper as 'Warring dealers guilty of tax evasion'