TORONTO — Evan Solomon’s sudden departure from the CBC over accusations he secretly facilitated art deals with high-profile clients is shining a light on the role of brokers in a lucrative business that experts say requires transparency.
Auction houses and galleries can act as brokers or dealers, but there are also many private brokers who represent artists and arrange deals with collectors. The broker’s role can also include attending auctions and bidding on behalf of a collector and going to galleries to try to connect collectors with pieces they want.
A broker usually gets a commission on art being sold and experts say disclosing that information prevents distrust and helps build honest relationships.
“Transparency is an enormous issue, because the lack of transparency creates suspicion,” said Shaun Mayberry, co-owner of Mayberry Fine Art in Winnipeg and Toronto. “When you get into the kind of dollar values associated with high-end collectibles, there’s some serious money attached to it and serious commissions being made and the lack of transparency is a key factor.”
The issue isn’t as prominent when dealing through a gallery or an auction house because terms of the sale are often posted on both sides, said Rob Cowley, president of Consignor Canadian Fine Art.
“Commission rates are very clear because there’s a contract,” he said Wednesday. “When somebody is selling at auction, it’s also very clear that there’s a buyer’s premium on the other side, so clients are well aware of the fees that are involved in the entire process.”
On Tuesday, the CBC said it had severed ties with Solomon, one of the broadcaster’s star hosts, after the Toronto Star alleged he took advantage of his position to broker lucrative art deals between a friend and people he also approached for interviews. The newspaper said Solomon took commissions of over $300,000 and allegedly didn’t tell the buyer he was being paid fees for his involvement in the deal.
Solomon has said he never intentionally used his position to promote the private partnership and that he was “deeply sorry” for any damage his activities had caused.
Private sales, Mayberry explained, are unregulated and sometimes don’t have a contract, creating a “pretty grey area” when it comes to commission.
“I do a lot of business on handshakes,” he said. “I’m not doing business with people I don’t know. I’m not doing business with people that haven’t been around for 40-plus years that obviously have a credible relationship in how they conduct their affairs.”
Mayberry advises clients to align themselves with those “whose opinions you share and trust, who conduct their affairs in a way that you deem appropriate.”
“One of the reasons that the art world at the auction level is so successful is because generally speaking, people know where everyone stands. But in the private world, because this is an unregulated industry, there is potentially an environment that can breed a high level of distrustful behaviour.”
According to Cowley, brokers play “a large role” in art dealings both at the auction and gallery level and privately. Some collectors prefer to go with a private broker because they might have exclusive access to works that may never be available on a public market.
Cowley said it’s rare for a broker to have another job outside the art world.
“I can think of some cases where we certainly do have individuals who may act as dealers once in a while, who may have other careers, but it’s in the minority,” he said.
Mayberry, however, did note that “some of the greatest art patrons were private individuals, private collectors, people who came from other professions.”
Victoria Ahearn, The Canadian Press