China's artwork auction market is marred by irregularities such as fake authenticity certificates, collaboration between buyers, sellers and auctioneers to push up prices, and illegal charges on the sellers, state media has revealed.
A recent Xinhua report said irregularities and fake deals were rampant, particularly among small auction houses. In extreme cases, art auctions have been used for money laundering.
Or they can be a front for bribing officials - a process that begins by persuading the official to put an artwork up for sale. Then the briber buys the artwork at a highly inflated price, Xinhua quoted Zhang Ning, deputy chief of the Chinese Cultural Relics Academic Society's committee for cultural relics appraisal, as saying.
In some cases, an artist may hire someone to buy his own work at an inflated price, hoping that will boost the price of his work in future.
Xinhua quoted a famous painter, Han Meilin, as saying that he had received so many complaints from people tricked into buying fakes of his work that he was sometimes forced to paint genuine works for the victims. He has had lawyers send letters to auction houses to stop them from putting fakes up for auction.
Another form of unethical behaviour involves employees who buy on behalf of a company. The employee may reach a deal with the seller before the auction, then collude with the auction house to push up the price during the bidding. The employee then splits the difference between the prearranged price and the inflated bidding price with the seller and the auction house.