March 19 (Bloomberg) -- Robert De Niro, testifying in the trial of Leigh Morse, an art dealer employed by Lawrence Salander before his conviction for felony fraud, said he didn’t consent to having proceeds from the sale of his father’s paintings deposited in Morse’s personal bank account.
Morse was director of Salander-O’Reilly Galleries, which declared bankruptcy in November 2007 amid claims that eventually totaled $299 million. She is accused of stealing from the estate of De Niro’s late father, and she has pleaded not guilty in New York Supreme Court to one count each of fraud and grand larceny.
De Niro, 67, testified Friday in the Manhattan courtroom that he didn’t give permission to anyone at the gallery to have $77,000 from the sale of three paintings by Robert De Niro Sr. wired directly to Morse’s account. The actor owned two of those paintings.
De Niro Sr. died in 1993 of prostate cancer on his 71st birthday. His son explained that his father did both figurative and abstract paintings and drawings. De Niro inherited his father’s estate of more than 1,000 works and has preserved the artist’s 2,000-square-foot lower-Manhattan studio as a kind of shrine.
The 13th-floor courtroom was packed for De Niro’s testimony. The rest of the trial has played to a largely empty room.
Wearing a loose green corduroy jacket, light-blue shirt and dark slacks, De Niro said his father chose Salander as his dealer. De Niro himself formally signed with Salander after his father died.
“He gave me the impression he liked my father’s art, he was enthusiastic,” De Niro testified. “That was good for me.”
Proceeds Split 50-50
According to documents presented in court, De Niro agreed to split proceeds 50-50 with the gallery.
Assistant District Attorney Micki Shulman Hendricks asked whether he objected to anyone at the gallery keeping the entire proceeds of a sale.
“That I have an issue with,” he said.
In his opening statement for the prosecution, Assistant District Attorney Kenn Kern said Morse withheld information about sales so consignors wouldn’t ask to be paid.
The actor said he couldn’t remember whether Morse or Salander told him about the $77,000 sale of his father’s paintings to San Francisco’s Hackett-Freedman Gallery in 2007.
“I don’t recall,” he said. “They could’ve. I don’t recall.”
Salander pleaded guilty to 30 counts of fraud and grand larceny a year ago and is serving six to 18 years in state prison.
Prosecutors said Salander operated a Ponzi scheme out of his Upper East Side gallery to finance spending sprees in Renaissance art and an extravagant lifestyle for him and his wife and seven children.
Lawyers for the actor spent almost two years in U.S. Bankruptcy Court fighting to recover the De Niro paintings consigned to the gallery. The actor was able to retrieve them in a settlement that included paying $14,000 to the bankrupt gallery.
De Niro said he had trusted Salander “absolutely” and wasn’t focused on the gallery’s dealings.
When De Niro met Salander in Portugal, Salander had his own airplane.
“It just didn’t seem to add up,” De Niro said.
Gallery in Rome
De Niro described learning that the Benucci gallery in Rome had taken title to several of his father’s works. De Niro said he had never sold any artworks to the gallery and called Salander. Salander said the gallery misled the actor.
“I felt he was delusional or deluding himself or just not being honest,” De Niro said of his onetime friend.
Morse’s lawyer, Andrew Lankler, described her in his opening statements as an employee with no responsibility over the gallery’s finances or payouts to consignors.
He acknowledged that $77,000 was wired into Morse’s personal bank account from the 2007 De Niro Sr. sale. He added that she was owed hundreds of thousands of dollars by the gallery and in the past had received the proceeds of sales directly to compensate for the money she was owed.
Under cross-examination by Lankler, De Niro said Salander-O’Reilly’s shows of his father’s art “were pretty well done.”
De Niro said he understood that art dealers who sell work are paid a commission.
“What you care about if your work is sold, you want to get paid what you’re owed?” Lankler asked.
“That’s about it,” De Niro said.
The criminal case is People v. Morse, 09-03581, New York State Supreme Court, New York County (Manhattan).
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