Art Market

How the World’s Biggest Financial Scandal Ensnared the Art World

Nate Freeman
Jan 17, 2019 4:17PM

Leonardo DiCaprio with Jho Low at The Wolf of Wall Street premiere in Paris, 2013. Photo by Bertrand Rindoff Petroff/Getty Images.

In late 2018, the actor and collector Leonardo DiCaprio made a visit to Washington, D.C., where he was ushered into a federal courthouse to secretly testify before a grand jury in a case that’s electrified the financial world: the multi-billion 1MDB scandal that started in Malaysia and has led to dozens of investigations and indictments globally, including the first criminal charges ever filed against Goldman Sachs.

DiCaprio, to be clear, isn’t a culprit in the scheme. Rather, the Titanic superstar has unique insight into how the funds ended up in a variety of bank accounts in the Cayman and British Virgin Islands, because it’s through DiCaprio and his friendship with Jho Low, the flamboyant financier at the center of 1MBD, that the scandal ensnared the free-spending arena of the contemporary art world.

(DiCaprio has offered no comment to the press, apart from a sentence from his spokesperson, saying that the actor, and his environmental foundation, will “continue to be entirely supportive of all efforts to assure that justice is done in this matter.”)

Low snapped up jets, yachts, jewelry, and penthouses around the world with his embezzled billions, before investigative reporting in 2015 revealed the scheme and brought down the complicit Malaysian prime minister who personally reaped hundreds of millions and now faces criminal charges. Low also went on an art-buying spree in 2013 and 2014 that quickly tallied up to more than $200 million. And that spree largely began when his high-stakes gambling partner and Hollywood co-producer, DiCaprio, staged a charity sale at Christie’s.

Needless to say, DiCaprio and Low have since gone their separate ways. Low was formally indicted with three counts of criminal conspiracy to launder billions of dollars by the Eastern District of New York in November 2018. He is reportedly currently evading arrest by hiding out in China, where the government announced Monday that it would assist Malaysia in looking for the fugitive.

Producers Riza Aziz, Joey McFarland, and Jho Low attend The Wolf of Wall Street premiere in New York City, 2013. Photo by Michael Loccisano/Getty Images.


But bold-faced art-world names litter the documents and criminal complaints that have amassed as investigations have ramped up in Washington, D.C. Aside from DiCaprio, art-world figures who did business deals with Low include the Sotheby’s financial services department, the Nahmad family, the private dealership SNS Fine Art, French mega-collector François Pinault, and former Christie’s post-war and contemporary chairman Loïc Gouzer.

Mystery club kid

Low first entered New York’s society pages in November 2009 when the New York Post ran an item about a Malaysian kid who came seemingly out of nowhere and allegedly began racking up $160,000 bar tabs during evenings on the town at Chelsea hotspots such as Avenue. Gawker was quick to assume that a twentysomething Wharton grad might be a front for some overseas billionaire, or up to something else shady. As one would have it, it was just before Low’s arrival in the Gotham gossip rags that the 1MDB fund was established by Malaysian prime minister Najib Razak, whose stepson Riza Aziz was an old schoolmate of Low’s in London.

1MDB was supposed to be a tranche of cash that could fund domestic cultural projects. Instead, the prime minister’s family and cronies moved the funds into Swiss and offshore accounts and found ways to invest them in high-priced luxury items. And according to the complaint filed by the U.S. Justice Department in 2017, it was in September 2009 that the first chunk of the misappropriated 1MDB funds were diverted into a Swiss bank account owned by Low, who then laundered $400 million of it into the United States.

His flashy ways got Low in good with celebrities like Lindsay Lohan and Paris Hilton, and after meeting DiCaprio, he started inviting the actor on lavish trips, including flying him to the 2010 World Cup final in Johannesburg on a private jet. In May 2011, Low agreed to back a new production company, founded with Aziz and the talent scout Joey McFarland, that would fully fund the $100 million budget of a movie DiCaprio was dying to make with Martin Scorsese. Major studios had backed out of funding the R-rated raunch-fest that they thought might fail to find an audience. That raunch-fest was The Wolf of Wall Street.

Bigger price tags

Low’s habit of paying for nebuchadnezzars of champagne at the club was a nice perk, but funding DiCaprio’s passion project truly endeared him to the actor; he thanked Jho Low and Riza Aziz both by name when accepting the Best Actor Golden Globe for The Wolf of Wall Street in 2014. Low was ready to support him on one other front. By May 2013, with filming on The Wolf of Wall Street wrapped, the actor returned to two of his other interests—art-collecting and environmentalism—by staging “The 11th Hour,” an auction of 33 works at Christie’s that would fund the many environmental causes supported by the Leonardo DiCaprio Foundation. The sale established 13 artist records and raised $38.8 million, thanks in part to Low—he registered an account with Christie’s just days before the sale through his business associate Eric Tan, and the holding company Tan maintained for Low, Tanore Finance Corporation. Prior to that, it’s only clear that he had made a handful of private art purchases, one being the $9.2 million Jean-Michel Basquiat painting, Redman One (1982), that he purchased from art dealer Helly Nahmad in March 2013.

At “The 11th Hour”—which DiCaprio organized alongside Gouzer, then a rising star at Christie’s—Low successfully acquired Mark Ryden’s Queen Bee (2013) for $714,000 and Ed Ruscha’s Bliss Bucket (2010) for $367,500. The charity auction appeared to be a gateway drug into art collecting. Two days later, at the post-war and contemporary art auction at Christie’s, Low was on the phone with Gouzer, instructing him to edge out Brett Gorvy to snag Basquiat’s Dustheads (1982) for $48.8 million with fees—then a record for the artist. After adding two works by Alexander Calder, the total for the five-work haul acquired over three days was $58.3 million.

The price tags kept getting higher. In June 2013, Christie’s arranged for Low to purchase Mark Rothko’s Untitled (Blue and Yellow) (1954) for $71.5 million—directly from the collection of François Pinault, the owner of the auction house and one of the world’s biggest art collectors.

Opulent auction boxes

By the next set of sales, in November 2013, Low requested that Christie’s put him in one of its tricked-out skyboxes, where he and McFarland could bid in privacy while indulging in the trappings of the high life.

“It better look like Ceasar Palace [sic] in there,” one Christie’s employee emailed to another, according to the complaint. “The box is almost more important for the client than the art.”

Low bought La maison de Vincent à Arles (1888) by Vincent van Gogh for $5.5 million at Christie’s impressionist and modern art evening sale and Pablo Picasso’s Tête de Femme (1935) for $39.9 million at the equivalent sale at Sotheby’s one day later. He ended the year with a two-work private sale at Christie’s on December 20th, where he purchased Basquiat’s Head of a Madman (1982) for $12 million and Concetto Spaziale, Attese (1967) by Lucio Fontana for $36 million.

And then there were the works purchased from SNS Fine Art, a company associated with the auction vets–turned–private dealers Thomas Seydoux and Stephane Connery: among them, Claude Monet’s Saint-Georges Majeur (1908), which Low bought for $35 million in December 2013 and had promptly shipped to the Geneva Free Port. He also snapped up five works by Calder, Roy Lichtenstein, Andy Warhol, and Yves Klein from an unnamed Monegasque art dealing outfit for more than $18 million.

Low continued his buying spree into 2014, capping it with the purchase of Monet’s Nymphéas (1906), a small oil painting bought at Sotheby’s in London during the June sales; it set him back $57.5 million. And while many of the works were going to freeports, some had other destinations. Low had decided to gift a few works—the $9.2 million Basquiat bought from Nahmad, and the $3.2 million Picasso from the Monaco art dealer, along with a Diane Arbus photo purchased for $750,000—all to one person.

“Dear Leonardo DiCaprio,” read the handwritten note from Low’s associate, Eric Tan, that came with the Picasso. “Happy belated Birthday! This gift is for you.”

Project Cheetah

In 2014, Low also started sniffing around for a way to get a loan—quickly.

“Do you know of any banks, financiers who take art as security for raise bank loans for investments/acquisitions of more artwork?” he emailed an unnamed employee of SNS Fine Art on March 13, 2014. Low explained that he had around $330 million in art that he could potentially put up as collateral, and was looking to get a 50 percent line on whatever he put up.

“I think those sort of numbers would scare off Sotheby’s,” the SNS employee responded.

Protesters hold portraits of Jho Low and Paris Hilton during a protest in Kuala Lumpur, Malaysia, 2018. Photo by Chris Jung/NurPhoto via Getty Images.

And yet, it appears that, with Low’s track record of spending and that much being put up as collateral, Sotheby’s Financial Services, Inc., was not at all scared off by the request. The Malaysian, who at that point was gaining a reputation in art-selling circles as a guy to unload big works onto, had acute demands for speed and utter secrecy. As a Sotheby’s Financial Services employee emailed to colleagues on March 20, 2014:

“Just wanted to bring you up to speed on the big loan opportunity.…[The borrower] doesn’t want us to use his name in our communications, he wants to be referred to as ‘the client’ and we will refer to this transaction as project Cheetah (referring to the speed at which we are trying to move).”

Four days later, Low emailed the same executive, emphasizing the confidentiality in one email—“Most imp is that client name or if bvi borrower (then guarantor name) does not show up in any public searchable document or public accesible [sic] doc,” Low wrote. In another email, he emphasized the speed with which he needed the $107 million, saying the the funds should be dispersed by April 7th—just two weeks.

They were a few days late. Low secured a deal with Sotheby’s on April 10th, through which he would leverage 17 works held in the Geneva Free Port, valued at somewhere between $191.6 million and $258.3 million, for a $107 million loan. The loan was to be deposited in an account at the Caledonian Bank in the Cayman Islands listed as Triple Eight, Ltd.—an entity fully owned by Low.

The sum helped fund the art Low purchased in 2014 and 2015, including the $57.5 million Monet. According to Tom Wright and Bradley Hope’s 2018 book Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World, the loan also almost funded the purchase of Picasso’s Les femmes d’Alger (Version “O”) (1955), which at the time was the most expensive artwork ever sold at auction. Low was purportedly the underbidder.

According to Wright and Hope, Low bragged to friends about his near-miss, saying that his final bid on the Picasso was for $170 million. If that’s true, he would have been on the phone with his previous auction world go-between—and DiCaprio’s longtime pal—Loïc Gouzer, who was the only specialist battling against Brett Gorvy on the lot as it nosed toward its final price. Gouzer did indeed offer a bid of $159.5 million—more than $170 million with fees, but in the ballpark—but Gorvy took it up to $160 million on behalf of his client, reportedly the former Qatari prime minister Hamad bin Jassim bin Jaber Al Thani, and the work hammered there, for a total of $179.3 million.

Selling big, going dark

After failing to win the ultimate trophy, Low began to unload. A May 2016 story in the Wall Street Journal described how, starting in February 2015, Low sold dozens of artworks for more than $200 million—even though most of the lots sold for well under what Low paid for them. The record-breaking Basquiat Dustheads painting he bought for $48.8 million? In April 2016, it went to hedge funder Daniel Sundheim for $35 million. The Rothko he bought from Monsieur Pinault for $70 million? It sold at Sotheby’s in New York in May 2015 for $46.5 million. The Monet he bought at Sotheby’s in London in June 2014 for £33.8 million ($57.5 million)? It was sold privately to a dealer in Hong Kong for €25.2 million—well below the €42.3 million equivalent he had paid.

The investigation into 1MDB was closing in on Low. Clare Rewcastle Brown, a London-based investigative reporter who focuses on Malaysian corruption, teamed with the Sunday Times to publish the first exposé on what it called the “heist of the century” in February 2015. In July, that was followed by a report in the Wall Street Journal that the current prime minister, Najib Razak—Riza Aziz’s stepfather—had taken $700 million from the 1MDB fund. He denied the allegations, and in January 2016, an ally who had quickly become attorney general—replacing the former AG due to vague “health reasons”—cleared Razak of wrongdoing. But Swiss and Singaporean prosecutors began to investigate, leading to June 2016, when U.S. attorney general Loretta Lynch announced the civil forfeiture demand, seizing more than $1 billion in assets in the form of luxury items purchased with 1MDB funds. That request lead to a lawsuit filed by the U.S. Justice Department in June 2017.

By that time, Low had disappeared—not just from the art world, but from the entire world at large. He’s wanted by the authorities in the United States, Singapore, and Malaysia, and there were reports that he was hiding out in a hotel in Shanghai evading capture through plastic surgery and a global network of tipsters. Despite the announcement this week that China would help Malaysia find the fugitive who masterminded the largest embezzlement scandal in decades, there’s been little luck thus far. Inspector-General Mohamad Fuzi Harun from the Royal Malaysian Police said that “the police are also communicating with Interpol and the status is the same.”

As for Leo’s art? In 2017, prior to offering his testimony, DiCaprio handed over to the government the paintings that the shamed financier, and former friend, had given him over the years. He even gave up the Basquiat that was gifted as a belated birthday present.

Nate Freeman
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Jenna Gribbon, Luncheon on the grass, a recurring dream, 2020. Jenna Gribbon, April studio, parting glance, 2021. Jenna Gribbon, Silver Tongue, 2019