Wealthy Mayfair art dealers hit by cyber attack costing them up to £1m

Wealthy Mayfair art dealers hit by cyber attack costing them up to £1m

2018-05-31T03:00:28+00:00April 3rd, 2018|

A group of wealthy Mayfair art dealers have been hit by a cyber attack which has lost them up £1 million to hackers.

At least nine galleries or individuals were affected, including Hauser & Wirth, and London-based dealers Simon Lee, Thomas Dane, Rosenfeld Porcini and Laura Bartlett. The galleries lost sums between £10,000 and £1 million, according to Hallett Independent Art Insurance. “We know a number of galleries that have been affected. The sums lost by them or their clients range from £10,000 to £1m,” said insurance broker Adam Prideaux of Hallett Independent, according to The Art Newspaper.  “I suspect the problem is a lot worse than we imagine.”

The galleries were hit by an email scam, in which hackers impersonated their accounts and manipulated huge sums from art investors. 

The method is simple. Fraudsters gained access to art dealers’ email account and monitored incoming and outgoing messages. When the gallery then sent a PDF invoice to a client via email after a sale, the hacker struck. Using an impersonated email as cover the hacker sent a duplicate, fraudulent invoice from the identical gallery email address. The client was told to ignore the first invoice and instead wire payment to the hacker’s bank account. The technique was also used to steal payments made by galleries to their artists.

London-based dealer Laura Bartlett was forced to close her gallery in east London after a cyberattack on a high-value sale over the summer.  Both she and her US client have been unable to recover the money from the intercepted sale, though the theft is under ongoing investigation by the Metropolitan Police. She told the Art Newspaper: “I didn’t have the financial security to weather this kind of scenario.”

“If it had happened at another time of year, when I’d had a better run, it might have been OK, but this particular sale was going to pay a lot of bills.”

Other London galleries have taken steps to prevent these forms of attack from happening again. Mayfair gallery Simon Lee  and Thomas Dane Gallery in St James’s have both overhauled their invoicing procedures. While Simon Lee’s gallery allegedly only lost a small sum, art dealer Lee now issues a standard warning about cyber fraud with every invoice and his accountant confirms banking details with clients over the phone.