Art Lender Accuses Maddox Gallery of Inflating Value of Art Used as Collateral—’Bizarre and Irrational’ Claim, Says Gallery
Luxury Asset Capital (LAC) has sued Maddox Gallery in a civil complaint filed in August in the US District Court for the Southern District of New York, alleging the gallery inflated valuations of artworks used as loan collateral. LAC claims Maddox provided knowingly false “good faith estimates” for works by Duncan McCormick and Albert Willem to persuade LAC to accept them as substitute collateral in exchange for a George Condo painting, after loans made in July 2022 to dealer Seth Carmichael went into default. The lender alleges a “pump and dump” scheme in which auction prices for McCormick and Willem were artificially bid up—sometimes to 10 to 15 times pre-sale estimates—before later falling, leaving LAC with works worth “only a small fraction” of what was represented. Maddox co-founder and managing director Nick Sharp said the gallery “categorically denies” the claims, calling them “bizarre and irrational,” while LAC did not respond to ARTnews’s request for comment.
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