Manhattan Art Advisor Pleads Guilty to $6.5 Million Fraud Scheme

Lisa Schiff admitted to defrauding clients out of $6.5 million by misappropriating funds from art sales and purchasesPhoto byDiogo NunesonUnsplash

Lisa Schiff, a Manhattan-based art advisor, pleaded guilty today to one count of wire fraud for defrauding clients of her art advisory business out of approximately $6.5 million, the U.S. Attorney's Office for the Southern District of New York announced.

From 2018 to May 2023, Lisa Schiff, who operated Schiff Fine Art, diverted client funds from the sale and purchase of about 55 artworks to cover her personal and business expenses, according to the U.S. Attorney's Office. Schiff, an intermediary between galleries, auction houses, and collectors, misappropriated the money instead of completing the promised transactions.

The U.S. Attorney’s Office said Schiff failed to remit payments to clients after selling their artworks, often lying by claiming the buyer delayed payment or the artwork was still in her custody when it had already been sold and delivered. She also failed to purchase artworks for clients, despite receiving funds, and falsely blamed her clients for payment delays to galleries.

According to court documents, Schiff defrauded at least 12 clients, one artist, the estate of another artist, and a gallery. The U.S. Attorney's Office noted that during her scheme, Schiff lived lavishly and incurred substantial debts, which she partially paid using the stolen funds.

“For years, Lisa Schiff breached the trust of her art advisory clients by lying to them and diverting millions of dollars they had entrusted to her. Instead of using client funds as promised, Schiff used the stolen money to fund a lavish lifestyle. Today’s guilty plea serves as a reminder that the Southern District of New York will vigorously investigate and prosecute those who engage in fraud, including in the art market,” said Damian Williams, U.S. Attorney for the Southern District of New York, in a statement.

According to the U.S. Attorney's Office, Schiff pleaded guilty to wire fraud, a charge carrying a maximum sentence of 20 years in prison. Schiff is scheduled to be sentenced on January 17, 2025.

Additionally, under the plea agreement, she agreed to forfeit approximately $6.4 million, according top the department.