The high-rolling art dealer who was secretly a multi-million-pound fraud

Only in a work of satirical fiction, surely, could an ambitious, personable and ruthless young art dealer be given the name “Inigo Philbrick”. But no: one of the remarkable things about Orlando Whitfield’s book is that Inigo Philbrick really exists. All That Glitters is an account of how the student friendship the author struck up with Philbrick led to the pair of them venturing at a tender age into the shark-infested waters of the contemporary-art market.

Inigo and Orlando set up a dealing business together, I and O Fine Art. Whitfield is the nervous one, Philbrick the risk-taking high flier. As the sums of money involved get larger, their paths diverge. Philbrick ends up in jail in America, while Whitfield’s collision with the great nexus of art and money leads him ultimately to the psychiatric hospital. The only consolation for Whitfield is that the experience provides excellent material for a memoir, and he takes full advantage of it. He has written a highly readable and perceptive account of how contemporary art is bought and sold.

Art dealers are, in Delacroix’s words, purveyors of fantasy. When what they’re selling is new and unproven and the buyers are rich and ravenously gullible, the opportunity to exploit the situation is hard to resist. For what is a piece of contemporary art actually worth? Whitfield recounts how a work that its owner consigns for sale to a dealer at $400,000 is retailing within hours at $600,000, after two or three intermediaries have blithely put their commissions on top (or, in trade parlance, been allowed “a lick of the lolly”).

There are many telling moments in Whitfield’s narrative. One occurs when a Goldman Sachs trader admiringly lists the things forbidden to him on the trading floor but commonplace in the buying and selling of artworks: acting on inside information, artificially inflating prices, choosing to whom to sell. On top of that, Whitfield continues, “prices are seldom openly displayed, ownership of works is often shrouded in legal mystery, deals are frequently sealed on little more than a handshake, and the storage of works in bonded warehouses and freeports can allow speculators to avoid enormous sums in tax.”

Is this, then, a market crying out for regulation? Readers will draw their own conclusions. My own experience suggests it is a commercial arena in which the persuasive skills have become paramount, to the point where some auction houses today prefer to recruit salesmen rather than experts. “I don’t do brushstrokes,” said one auction house specialist to me not long ago. “I only do dollars.” Never was the old art-trade adage truer: a successful dealer is someone who can sell a painting he doesn’t like to a buyer who doesn’t want it.

Some might respond that the art trade was ever thus. But that’s not quite true: never before has contemporary art dominated the art market to the extent it does today. And never before has contemporary art assumed a form so conducive to charlatanism. That’s not to say there isn’t some outstanding contemporary art being produced in the 21st century. It’s just that there is also some rather poor stuff being inflated in value by manipulative elements in the art trade, and it’s sometimes not easy to tell the difference.

Philbrick’s rise and fall were spectacular. Considering the flagrance of his frauds – selling the same painting to three different buyers at the same time, for example – why wasn’t he seen through sooner? Mendacity, the author says, can have the effect of destabilising reality: “As I tried to understand the mess of deals that led to Philbrick’s downfall, it struck me that in their opacity they appear to point to something larger. The manic complexity of Philbrick’s scheme now seems to me analogous to the art market as a whole – deliberate, wilful obscurity as a modus operandi.”

Art dealers need money to stay alive, and the rich need art to stay alive. This is the reciprocal dynamic that drives the market and propels art dealers into intimate contact with some very rich people indeed. The experience can be disconcerting, and for some dealers the temptation to assume the lifestyle of their clients is difficult to resist. Private jets, fast cars, exclusive restaurants and limitless champagne were all eagerly embraced by Philbrick. In the event they all proved disastrously beyond his means.

Whitfield is a sympathetic narrator, and his book is written in a spirit not so much of recrimination as regret for the actions of his erstwhile friend and partner. He has to tread carefully, however, because in his glory days Philbrick worked closely with some of the leading players in the contemporary art market, and the manuscript of All That Glitters must have kept Profile Books’ legal team on their toes. At least Whitfield himself has now swum clear of the sharks. He is no longer an art dealer, but is carving a new career as a writer. On the evidence of this book, it will be a successful one.

Philip Hook is former director of Impressionist and Modern Art at Sotheby’s. All that Glitters is published by Profile at £20. To order your copy for £16.99, call 0808 196 6794 or visit Telegraph Books