Was ILLICID Report ‘Buried’ For Failing to Show Illegal Trade?

Are Anti-Art Trade Activists Determined to Perpetuate a Lie?

German national library of science and technology at the University of Hanover, Technische Informationsbibliothek und Universitätsbibliothek Hannover, Germany, Author; TIB / EUROMEDIAHOUSE, Wikimedia Commons, Creative Commons Attribution 2.0 Generic license.

The April 10, 2015 press release announcing the launch of the ILLICID project stated:

“Profits from illegal trade in cultural goods are an important pillar of organized crime. There are links to the drug and arms trade, to money laundering and terrorist financing. At present, there is neither reliable data on the annual scope of the illegal trade in cultural goods in Germany nor efficient methods for collecting the corresponding facts.”

From the IADAA analysis and summary of the ILLICID report, July 2019:

Ever since the German government announced the need for stricter laws for the art market in 2014, officials repeatedly voiced what have since been shown to be unfounded claims that the illicit trade in cultural goods is a “billions of euros business” “coming third after the illegal drugs and arms trade”, that Germany was “the hub of the illicit trade in cultural goods” and that this “ever increasing trade” was connected with “organised crime and its proceeds used to finance terrorism”. These claims sought to justify strong counter measures… The ILLICID project, with its scientific approach and multi-institution support, was devised to produce this evidence and capture “the orders of magnitude, actors, networks, routines, and the potential for profit and money laundering.” After two years of study and an extension of a year to produce its analysis, we have a 9-page report that shows it has failed to do so. German customs, who have not reported any seizures in this field during the past five years, will not be surprised about these findings. Art market professionals and collectors have known all along that the claims were nonsense.

The much-heralded report from the ILLICID project, more than a year overdue and only nine pages long, has been published and then quietly shelved in a German library. It appears that the ILLICID project researchers did not find the data they set out to find. There was no billion-dollar online auction trade in illicit artifacts, and in the 356,500 items studied, the project found no evidence of ties to terrorism or organized crime. Yet restrictive German legislation has already been passed based upon unsubstantiated claims that a billion euro antiquities market was financing terrorism, the same claims that the authors of the ILLICID report said they would document, but could not.

An English-language summary and analysis of the ILLICID report is available on the website of the International Association of Dealers in Ancient Art (IADAA),[1] which is the primary source for this article. There is also commentary available in German from the umbrella organization, “Interessengemeinschaft Deutscher Kunsthandel,” which also reported on the ILLICID report’s publication. The Interessengemeinschaft Deutscher Kunsthandel represents the collectors, auctioneers, galleries, coin and book-sellers most affected by the restrictive German legislation passed in 2016.

What did the ILLICID project find?

The project analyzed 356,500 items appearing in online art, coin, and other auctions of cultural materials between July 2015 and June 2017. Although the initial target area had been stated as the war-torn regions of Syria and Iraq, the project instead focused on the broader category of Ancient Cultural Objects from the Eastern Mediterranean (AKOM).  The researchers identified 6,133 items, representing only 1.7% of the total, as potentially from this region, which includes Greece, Turkey, Egypt, Cyprus and other eastern Mediterranean countries as well as Syria and Iraq. The report did not distinguish whether items had recently entered the market or had been in circulation for decades.

More than half of the Eastern Mediterranean items studied were sold in lots, with only “general photographs,” an auction practice for very low value items. Of the 6,133 items offered at auction from the Eastern Mediterranean, the researchers identified 2,387 as “potentially” coming from Syria or Iraq. Of the “potentially” Syrian or Iraqi items, only 853 were offered as single items.

The ILLICID researchers found that within the 6,133 “relevant objects” found, probably only 24% of the “potentially” Syrian or Iraqi items were unquestionably authentic, 61.5% had insufficient information to tell, 12% were suspected fakes, and 2% were incorrectly classified.

Sales values from the ILLICID project

Of the auction sales of the 6,133 Eastern Mediterranean objects studied by ILLICID, only 3,245 were sold, representing slightly more than half, or 52.9%. Of the materials that sold, the sales values came largely from the 498 Greek, Roman glass, and 506 Egyptian sculptures, ushabtis and scarabs. The sales of all 6,133 items amounted to €1,693,674 for the two years of auction sales studied, approximately €850,000 each year.

The vast majority of items were low value:

  • The majority of bids (71%), including multi-item lots, started at under €1000 (10% at under €100).
  • Only 14% had a starting price over €1000.
  • For 15% no starting price could be determined.

Did the ILLICID Project actually find ‘suspicious sales?

The ILLICID researchers identified only four sales they deemed ‘suspicious.’ Two items were possibly from Syria or Iraq; two were from Egypt.  However, there was no apparent link to illicit trade. These sales were noted as suspicious because the original price in Germany was significantly lower than a later sales price outside of Germany. In one case, an object offered at a low price achieved a high price within Germany. (It is not unusual that an object would be recognized as of a higher value in another market or by another buyer. The researchers did not appear to have considered possibilities such as a bidding war between buyers, or a failure to recognize an object’s artistic quality by the auctioneer in the first German sale of these four items.)

The four items were:

  1. Terracotta from Iraq, starting price in Germany: €200, Sale price in Germany: €260, Sold six years later in the US for $17,500.
  2. Idol from Syria or Lebanon, starting price in Germany: €640, sale price in Germany: €800, sold 1 year later in the US for €2400.
  3. Mummy mask from Egypt, starting price in Germany: €480, sale price in Germany: €1200, sold in the US 2 years later for €4265.
  4. Figurine from Egypt, starting price in Germany: €2400, sale price in Germany: €43,000. Sold in the UK two years later. Staring price on request: £50,000.

The researchers considered that sales of these four items might have represented money laundering activity, but also stated that money laundering was not an ‘inevitable’ conclusion.

In sum, the analysis of the ILLICID Project Report found that the market in ancient goods was a tiny fraction of what the project’s leaders announced in advance as its likely size and value. The ILLICID project also did not find any evidence to demonstrate that online auctions sold illicitly trafficked goods – or any link at all to financing of terrorism or organized crime.

False predictions drove media speculation and wild exaggeration

Even before the project began, its director, Prof. Dr. Markus Hilgert, of the Ancient Near East Museum at the Pergamon Museum in Berlin, had stated that the online auction trade was ideal to study because it had a “very high volume of objects,” that were part of illegal trafficking in antiquities said to be worth billions of dollars. Before the study had even begun, ILLICID’s first press release described the antiquities trade as  “an important pillar of organized crime,” and said that Germany, “is currently an important market and transit state.”

The ILLICID project’s specific goal, when it began in 2015, was to quantify the ‘dark’ antiquities trade in Germany, particularly trade in possibly looted objects from vulnerable countries at war in the Middle East. Another key goal, described in the project’s first press release, was to establish a methodology to enable analysis of the overall illegal trade in antiquities.

It does none of this. The report’s sparse nine pages of explanation and analysis does not show that there is a significant trade in antiquities; it does not show that illegally trafficked items form a substantial part of the art trade; and it does not show that important or valuable looted items from Syria or Iraq are being trafficked at all. Nor does it present new methodologies geared toward tracking illicit trade in recently looted objects; it states that a new app will be available this summer, but there is no description of what the app will do. What the final report does show is that (1) the online market has a  low percentage of antiquities from the Mediterranean area,  (2) a high proportion of this trade is in very low value objects sold in lots and (3) this market includes a high percentage of probable fakes.

Severe restrictions on all trade in antiquities under German law

Yet enormous damage to German collectors, museums, and the art trade has already been done by legislation ostensibly in response to the illicit trafficking the ILLICID project was supposed to show. When the ILLICID project was announced, its director said that even the interim results of the project would be key to formulating a new cultural property law then being introduced in Germany.

Although  no such interim results were announced, Professor Hilgert’s public pronouncements (and YouTube videos) discussing supposed illicit trafficking networks worth billions of dollars and links to terrorism were used by Germany’s Cultural Ministry to justify passage of regulations on the antiquities trade to “counter its threat to German security” in July 2016.

Passage of the 2016 Ac‎t on the Protection of Cultural Property‏ placed restrictions on the export of German cultural property of “national significance,” including relatively recent works of art, and required registration of important and valuable works. Both import and export of ancient art under the Ac‎t on the Protection of Cultural Property was severely restricted, even for objects of very low or no financial value. Section 28 of the Act states:

“Importing cultural property shall be prohibited if it has been classified or defined as national cultural property by a member state or a state party and has been removed from the territory of this state under violation of its legislation protecting national cultural property…”

The legislation was passed despite there being no factual data to indicate that there was a sizeable German market in Middle Eastern antiquities, legal or illicit, either in 2016, or today.

A key finding of the ILLICID report was that only 2.1 % of the objects examined had export papers that would be sufficient to meet the standards for documentation set under the German law. The inability to find documentation for almost 98% of objects in circulation shows that despite the most thorough research, the legal export of an object in most cases can not be established through written records. This does not mean that virtually all objects in circulation were illegally exported; but it does show that such documentation does not exist for the field of antiquities. Many art source countries have never provided documentation on export for any items, or when they did, as in the case of Egypt, where licensed export was common until 1982, the documentation was insufficiently detailed and specific to be able to be correlated to objects in the market today. This 98% inability to meet German law standards means that the German law is far too narrowly crafted.

New and draconian EU Regulations wholly unjustified

For the last three years, EU Parliamentarians have used the same supposed “facts” about the antiquities trade to propound severe measures against “terror financing with cultural goods.” The EU Regulation 2019/880 severely restricts the import of ancient art, books and manuscripts and antiques into the entire European Union. The regulations will be fully implemented by 2024-2026. The law will require the provision of documentation for the circulation of antique and ancient art that Members of Parliament have been told many times simply does not exist. Because the requirement of the law will be impossible to satisfy, it will act as a de facto ban on the import of antiquities.

Yet the IADAA analysis states:

The EU’s own research, commissioned from Deloitte, has already shown that none of the 28 Member States had reported any evidence of this problem, and yet damaging legislation was pushed through anyway. On April 17, 2019, the REGULATION (EU) 2019/880 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the introduction and the import of cultural goods was published. Had the ILLICID report been published on its initial due date, soon after February 2018, its findings showing the lack of evidence might have helped mitigate the unnecessary harm that the new EU regulations are now likely to inflict on Europe’s legitimate art market.

As the IADAA analysis notes, the extensions granted to the ILLICID project and the EU Parliament’s failure to demand evidence before acting will have a devastating impact on the legal art market.

UNESCO backing and 1.2 million invested

German national library of science and technology at the University of Hanover, Germany, Am TIB-Standort Sozialwissenschaften finden Sie Literatur der drei sozialwissenschaftlichen Fachgebiete Politikwissenschaft, Soziologie, Sozialpsychologie und angrenzender Fächer. 1 November 2011, Author: TIB / EUROMEDIAHOUSE, Technische Informationsbibliothek (TIB) from Hannover, Wikimedia Commons, Creative Commons Attribution 2.0 Generic license.

The ILLICID project was launched in 2015 with €1.2 million in German government funding.[2] It was organized by the Prussian Cultural Heritage Foundation (SPK) in collaboration with the Fraunhofer Institute for Secure Information Technology (SIT), Darmstadt, and GESIS – Leibniz Institute for Social Sciences, Mannheim.

The project was also supported by UNESCO, which described it as a “transdisciplinary research project with a specific focus on illicit trafficking in Cultural Property from Iraq and Syria.”

According to the initial UNESCO announcement:

“The plan is to develop new analytical instruments and research approaches to better identify trafficking networks and processes and to better understand financial flows in the field of organized crime and terrorism, as well as to develop a digital object depository to be used by law enforcement and customs authorities.”

(UNESCO representatives continue to allege worldwide antiquities smuggling on a massive scale, and to quote long-discredited myths about illegal antiquities trade being the 4th largest illegal trade after arms, drugs, and human trafficking. These wildly exaggerated claims are not supported by police and law enforcement official reporting from the World Customs Organization and others.)

The final question: did the ILLICID project at least develop new methodologies to gather data on the magnitude of illicit trade and terrorist financing, as it planned?

While the project did gather data, its methodology did not break new ground – and it did not find what it claimed to be looking for.  The ILLICID project does not appear to have realized its ambitious goals, in large part because the project’s Director, Professor Doctor Markus Hilgert defined its expected results before it was even started, and because these “results” have so far turned out to have no basis in fact.The full report is titled: Verbundname: Illegaler Handel mit Kulturgut in Deutschland. Verfahren zur Erhellung des Dunkelfeldes als Grundlage zur Kriminalitätsbekämpfung und -prävention am Beispiel antiker Kulturgüter, Akronym: ILLICID; Teilvorhaben (TV3): Antike Kulturgüter aus dem östlichen Mittelmeerraum: Identifizierung, Klassifizierung und Dokumentation von in Deutschland gehandelten Objekten : Schlussbericht zu Nr. 3.2, BNBest-BMBF 98

The report is now filed at the Technical Information Library Hannover (TIB) (Technische Informationsbibliothek) and is available online here: https://www.tib.eu/de/suchen/download/?tx_tibsearch_search%5Bdocid%5D=TIBKAT%3A1664575944&cHash=87880dc7fdf3c8615245fa3a793e6677#download-mark

[1] Many thanks to Vincent Geerling of the International Association of Dealers in Ancient Art and to Ulrich Künker and Dr. Christina Berking of the Interessengemeinschaft Deutscher Kunsthandel for providing their analysis to Cultural Property News.

[2] The ILLICID project was funded with 1.2 million euros by Germany’s Federal Ministry of Education and Research as part of the program “Research for Civil Security II” in the area of ​​”Civil Security – Protection against Organized Crime.”

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