It was the kind of big ticket sale that puts a new art auction house on the map: A bidder on the phone in Italy offered $1.7 million for an 18th-century Chinese vase from Altair Auctions of Norwood, an eye-popping price more normally seen at elite houses like Sotheby's or Christie's.
But when the Globe, acting on a tip, discovered that the vase bore a striking resemblance to a modern reproduction auctioned off a year ago for just $3,840, the deal began to unravel. The two vases are almost certainly one and the same, but sometime between the earlier auction and the Altair sale on March 30 someone had written a phony ownership history and placed a Christie's sticker on its base, as if to hide its humble past from a rich new buyer.
"You could tell from looking at it that the vase did not predate the 20th century," said James Jackson, the Iowa-based auctioneer who sold the vase on May 23, 2012, as a relatively low-cost reproduction. "It didn't require an expert. It would be like putting a Mercedes-Benz hood ornament on a VW Beetle."
Now, instead of making Altair's reputation, the vase sale is threatening to topple the company before its first anniversary as federal prosecutors begin an investigation into whether Altair or its clients engaged in fraud to inflate the price of the porcelain vase or other art works.
Altair's owner, Benjamin Wang, insists the vase he sold is authentic, but he has canceled what would have been the biggest sale in the company's history.
After giving various accounts of the vase's history, Wang now says it is probably the same one that Jackson sold a year ago, but that Jackson didn't realize what a valuable antique he was selling. Wang admitted he made a "big mistake" by not questioning a false sales history provided by the vase seller, but said that shouldn't take away from the antique's value.
"We have an item we say is worth more than $1 million," said Wang's attorney, Orestes Brown, explaining that Altair plans to send the vase to China to be authenticated by a government agency. "We don't want the reputation of the vase to be tainted because of the opinion of some guy with no credibility," he said, referring to Jackson.
The vase's owner, a customer of Wang's named Dong Hua of Andover, hung up on a Globe reporter and didn't return repeated phone calls seeking his explanation for why he said the vase had last been sold in 1989 rather than in 2012 as Jackson's records show.
The imbroglio offers a rare glimpse into the frenzied Chinese art and auction market, which has exploded in recent years as wealthy Chinese collectors have spent vast sums on art and other luxury items at auctions around the world.
But with that rapid growth has come charges of fraud and fakery as people attempt to cash in on perhaps the world's most lucrative art market.
"The trouble in China is that 70 percent of the art is fake. Even villages are reproducing ancient prototypes. A lot of the modern art is fake as well," said Robert K. Wittman, a former FBI agent who runs a firm that specializes in recovering stolen treasures.
And the problems don't stop there: Some bidders are fake, too.
"One of the big problems is phantom buyers in the Chinese markets," said Wittman. "What's happening is the Chinese are bidding up their own artwork . . . so they can point to that and say this is what it's worth."
Wang, a native of China who studied Chinese arts and antiques at the Institute of Mongolian History, launched Altair in September 2012 to specialize in Asian art and antiques. Tucked into an unassuming strip mall next to Buddy's Budget Tile, Altair quickly began racking up big sales in Chinese art, including a blue and white Chinese vase that the company says was sold for $566,400.
But auctioneers are only as good as the collectors who bring them art and antiques to sell, and rival auctioneers often battle for their loyalty. A month after Wang started Altair, his former employer, Kaminski Auctions of Beverly, sued him for fraud, alleging Wang had diverted clients and their valuable objects from Kaminski's auction house to Wang's businesses, including Altair and a Salem antiques shop.
Wang denied Kaminski's charges — including assertions that Wang stole a Chinese sword and sold it for $1.4 million — calling them "ridiculous and preposterous." Several of his regular collectors wrote affidavits in Wang's defense, including Hua, who has sold antiques through Altair.
The controversy over the $1.7 million vase — formally known as a "double famille rose double gourd" — at first blush might seem to be little more than sparring between rival auctioneers, including one, Jackson, who may have let a huge payday slip through his fingers by not recognizing the true value of the vase.
But there's little doubt that someone embellished the vase's pedigree between May 23, 2012, when Jackson's International Auctioneers & Appraisers in Cedar Falls, Iowa, auctioned the piece off as a reproduction, and March 30, 2013, when Altair sold it as a genuine 18th-century piece for almost 500 times more.
Wang and his lawyer, Brown, say that the vase seller, Hua, gave them the false provenance, the documented history of ownership that buyers rely on in part to determine the value of art and antiques.
According to Brown, Hua also attached a sticker to the bottom of the vase showing it had last been auctioned on Feb. 23, 1989, at a Christie's sale in South Kensington, England. Wang said Hua had a receipt from the sale.
But Wang, who is supposed to authenticate a piece's value, never checked with Christie's or asked to see Hua's sales slip in evaluating the vase, according to his lawyer. Instead, he concluded that the piece was an authentic 18th-century vase, not a modern copy, based on his own art expertise and the word of a consultant provided by Hua, Wang said.
If Wang had investigated the sticker on the bottom of the vase — marked "297" under a Christie's label — he would have figured out the deception immediately. Lot 297 in the February 23, 1989, Christie's auction in South Kensington was not even a vase: according to a Christie's spokewoman, it was a 10¼-inch blanc de chine statuette of Guanyin, Buddhism's goddess of compassion. It had an estimated value of about $100.
The location of the 1989 auction offered clues to some art experts, too. Christie's South Kensington auctions are generally reserved for relatively inexpensive objects, described by one art expert as "tchotchkes" or trinkets.
But Wang accepted Hua's documentation without question, splashing a full-page photo of the vase in Altair's glossy auction catalogue and estimating its selling price at $60,000 to $80,000.
Then, to what Wang said was his surprise, the spirited bidding on March 30 drove the selling price up to $1.7 million, more than 20 times what he had estimated as its value.
When the Globe began asking questions about Altair's record-price vase, Wang said he was excited about media coverage, saying it would be "good exposure for my company." Asked why someone with a million-dollar object would sell it through an obscure, fledgling auction house, Wang said the big name auction houses charge more, make mistakes, and complicate sales with red tape. He insisted on April 11 both that the vase was authentic and it had not been sold since 1989.
But when Jackson was approached by the Globe, he was just as sure that the vase Wang sold in March was the same one he sold last year — and that it's a 20th-century reproduction. Both the pattern and the wear marks on the two vases look the same.
The only apparent difference were the identification stickers on the bottom — Jackson's vase had a torn and yellow Christie's sticker with an illegible number, while the Christie's sticker on Altair's vase was newer and intact.
"If Mr. Wang is so confident in his expert skills, then why not have a mutually agreed upon appraiser assess it?" said Jackson, whose father founded his auction house in 1969. "I suspect Mr. Wang knows that in reality he has nothing to gain and everything to lose."
Now Wang admits he "made a big mistake" by not checking the vase's sale history, agreeing that he probably auctioned off the same vase as Jackson's in 2012.
But Wang still insists the piece is worth a million dollars, arguing, "The fact it sold for so high shows it's real."
Nonetheless, Wang has canceled the March 30 sale, costing himself a commission of about $300,000.
The aborted vase sale has already attracted the attention of the Department of Justice, which is beginning an investigation into whether Wang, Hua, or others deliberately misled potential buyers, according to a person with direct knowledge of the inquiry.
The Justice Department has not yet determined which office will carry out the investigation, this person said.
Authorities in art fraud say it is not clear whether any laws were broken and, if so, by whom.
"It could be anything from an honest mistake to — if indeed more than one individual is involved and they used the Internet to advertise, it could be a federal crime — wire or mail fraud," said Wittman, the former FBI agent who runs the stolen art recovery firm. "If it can be proven that an auction house has conspired to put out incorrect provenance in order to benefit itself, there is exposure. It's not buyer beware."