It was at all times Alan Bond’s intention that the artworks would be acquired for Craig Bond … or such entity as Alan Bond determined.
Allegation in Supreme Court of South Australia1
The end of the Australian Federal Police (AFP) investigation is by no means the end of this story, because Alan Bond was still the target of a huge legal action that might cost him and his son Craig several million dollars and quite possibly result in criminal charges for fraud being brought against them both.
The statement of claim in this case, which began amid great secrecy in the Supreme Court of South Australia in 1996, charged that Alan and Craig Bond had ‘knowingly instigated, directed and participated in a sham transaction … intended to disguise a dishonest and fraudulent scheme’.2 And there was a mass of evidence to back up the charge.
The ‘dishonest and fraudulent scheme’ bore remarkable similarity to Alan’s conduct over Manet’s La Promenade, for which he was jailed in 1996, in that it involved the disposal of thirteen paintings by Bond Corporation in January 1990 for $5 million less than their market value. Ostensibly, the artworks were sold at arm’s length to an art gallery in Fremantle. But according to the statement of claim filed by the liquidator of Bond Corporation Holdings, they were handed over to Craig and Alan Bond for a small fraction of their real value.
Meanwhile, Bond Corp’s managing director Peter Beckwith allegedly got a handsome kickback for allowing it to proceed. According to the statement of claim:
The sum of $250,000 was paid by Alan Bond … for the benefit of Peter Beckwith as consideration for the participation of Peter Beckwith in the fraudulent and dishonest scheme.3
By far the best known of the thirteen disputed paintings was John Webber’s Portrait of Captain Cook, which has graced the front of many an Australian history book. A great favourite of Bond’s, it had held pride of place in Dallhold’s boardroom throughout the 1980s, when he posed beside it for posterity and told the world that he had much in common with the great explorer. Both he and Cook, he suggested, were bluff, daring buccaneers whose fellow countrymen had failed to recognise their true value.
Shortly after he was made bankrupt in 1992, Bond was asked by Bob Ramsay if he knew what had become of the painting which at that stage had vanished into thin air. He wrote back to say that it had been sold by Bond Corporation and that he had played no part in the sale, implying that he had no idea where it had gone. But if the Bond Corp liquidator is to be believed, Bond knew perfectly well where the Captain Cook portrait was hidden and how it had come to be there, because his old friend Jurg Bollag and his art dealer Angela Nevill had been looking after the painting and at least six other missing artworks since January 1990. And according to Nevill’s sworn testimony, both were acting on Bond’s behalf.
January 1990, when the paintings went missing, marked the beginning of the end for Bond and his business empire, for it was the moment that his house of cards really began to collapse around him. Dallhold had been defaulting on its loans for months, Bond Corporation had announced the biggest loss in Australian corporate history, and Bond Brewing had just been placed in the hands of the receivers.
Meanwhile, Bond’s most valuable art treasures were fast disappearing out the door. Irises, the famous Van Gogh painting that he had bought only two years earlier for a world-record US$54 million, had been confiscated by the Swiss banks who had helped finance it, and Manet’s La Promenade, which Alan had snitched from Bond Corporation in the hope of saving his Van Gogh, had been despatched to auction in New York to pay the bills.
As the bailiffs banged on the gates of his empire, Bond had clearly decided to salvage what he could from his art collection before it fell into the hands of his creditors. According to the Bond Corp liquidator’s statement of claim, Alan and his managing director Peter Beckwith arranged for the Captain Cook and six other valuable Bond Corp artworks to be shipped out of the country under cover of a pretended sale to a local racing identity, George Way. Or, as the statement of claim put it:
Alan Bond orally informed George Way … that he wanted to acquire the SECL [Bond Corp] artworks and transport them to England … that he required the assistance of George Way … that he would pay Way a fee of $50,000 plus expenses … that the paintings would then be Alan Bond’s.4
Bond allegedly told Way that he would lend him the money to buy the paintings (which were being sold by Bond Corp at one-sixth of their true market value) and prepare the sale documents. All Way would have to do was provide blank sheets of his gallery’s notepaper, sign the finished papers and then collect his fee. The ownership of the paintings would then pass to the Bonds.
George Way, who was a friend of Eileen Bond, was a well-known scoundrel on the Perth racing scene who had enjoyed a long and colourful career as a racehorse trainer until 1987, when he had been banned from the world’s racetracks for twenty years after two of his winners tested positive to the go-faster drug etorphine—commonly known as elephant juice. To the surprise of many, he had then opened an art gallery in Fremantle to sell paintings to his millionaire mates like Laurie Connell, which he found was an easier way to make a living.
In fact, George knew a fair bit about art, and he also knew a good business deal when he saw one. So he allegedly agreed to let Bond use his High Street Gallery as a front for the ‘purchase’ of these valuable Bond Corp paintings, in exchange for an easy $50,000. But it is clear that he never took delivery of the pictures. Nor did they go anywhere near Fremantle. Nor did he ever own them. As Way must have known perfectly well, the paintings were being acquired by the Bonds. The ‘sale’ to Way was merely a sham and a way for Bond to get hold of the artworks at a knockdown price.
On 4 January, the curator of Bond’s private art collection, Diana de Bussy, arranged for the Portrait of Captain Cook and the six other most valuable paintings to be crated up and collected from the Bond Tower by Grace Brothers Fine Art. She had been told that they were headed offshore and had outlined the arrangements in a memo to George Way and Alan Bond. The shipping invoice stated that they were being sent overseas for exhibition and promotion but, as de Bussy feared, they were not meant to come back.5
Two days later, on 6 January 1990, the paintings were driven out to the airport and loaded onto a British Airways Boeing 747 bound for London. The next morning they arrived at Heathrow Airport and were trucked off to a fine-art storage warehouse, James Bourlet & Sons. A week after that, they were delivered to Bond’s art dealer Angela Nevill in Kensington. Jurg Bollag had phoned to tell her that they were coming and to say that he had authority to sell them.
The diminutive Lady Nevill was hardly the most charming woman in the art world or the most popular. Several of those who dealt with her described her as haughty and tough as nails. But she was both well connected and as blue-blooded as they come. The Nevill family title dated from the fifteenth century, and one of her noble ancestors had sat in judgement on Mary Queen of Scots. More recently, her brother, the Marquess of Abergavenny, had served as a page of honour to the Queen and her uncle had been Her Majesty’s representative at Ascot races. Unkind critics in England whispered that Bond had chosen her because he coveted a knighthood. But no one suggested that Nevill didn’t deserve his custom. She was an excellent judge of pictures, and utterly discreet.
Nevill had been dealing in art for Bond since the late 1970s and had assembled an amazing collection with his money. She had also made a small fortune for herself by charging 10 per cent commission plus expenses on everything she bought for him. And now she was about to make even more money by helping him dispose of it again. Within six weeks of the Bond Corporation paintings arriving in London, she managed to find a potential buyer for one of the most valuable works, a French Impressionist portrait of Dora Hugo by Paul-Cesar Helleu. Back in Perth, Alan Bond allegedly told his managing director at Dallhold to accept the offer.6
George Way, who supposedly owned the painting, was kept completely out of the loop. Three weeks later, when the sale was completed in London, it was not even Way’s company that sold it. The contract was signed by Angela Nevill and Jurg Bollag, with his new Isle of Man company Firstmark, which had been set up six months earlier, acting as the vendor. Nevill was asked on oath by the liquidator’s lawyers in 1996 what role Bollag and Firstmark played in the sale. She replied, ‘At all times I clearly understood that George Bollag and Firstmark were acting on behalf of Alan Bond and the Bond family’.7 Soon afterwards, she amplified the role of Firstmark by saying, ‘I understood … Firstmark to be an entity related to Alan Bond or the Bond family’.8
On Bollag’s instructions, £230,000 from the sale of the Dora Hugo portrait was telexed back to George Way in Perth to be passed on to Bond Corporation. Angela Nevill took her 10 per cent commission and the London lawyers took their fees. Bollag then ordered the lawyers to pay whatever money was left from the sale to the ‘Jane’ account at the Zuger Kantonal Bank in Zug. Or in other words, to Alan Bond’s offshore money box.9
Over the next three years, Bollag and Nevill sold a further five of the thirteen artworks and collected another $621,000, allegedly for Bond. Some of this was despatched to Bollag’s JF Consulting in Zug, some was paid into the client account of Bollag’s London lawyers, and roughly half, or $306,000, was paid into an account at the Private Trust Bank in Vaduz, Liechtenstein, held in the name of SIDRO Anstalt—or in other words, to Alan Bond again.10
But getting rid of the Captain Cook portrait was a far tougher proposition for Nevill and Bollag, because it was so well known and because the obvious market was in Australia, where the bankrupt Bond was still being chased by Ramsay’s investigators. It would take enormous nerve to sell it there and it would ultimately cause enormous problems because it would bring the issue of the missing artworks squarely into the public eye.
By June 1993, when the Bond camp had plucked up enough courage to offer the Captain Cook painting for sale, the mysterious disappearance of the Webber portrait from the Bond Tower in 1990 had become a big story back home. So when the then managing director of Sotheby’s Australia, Robert Bleakley, phoned the director of the National Gallery of Australia, Betty Churcher, from New York to tell her that he could obtain the painting for the gallery, there was great excitement, which soon leaked into the press.
Bleakley told Churcher that the asking price was $3 million. But within three weeks he was offering to cut it to $1.6 million on the basis that the Captain Cook’s mystery owner was keen for the painting to return to its rightful home.11 Betty Churcher may well have had suspicions that it was being sold by Bond, because there had been reports in the newspapers about the suspicious sale to Way, and these would have been amplified by a report from the gallery’s curator of Australian art, Mary Eagle, identifying the vendor as ‘a private collector believed to be Alan Bond’. But she nevertheless signed the purchase proposal and added her own handwritten note to say that she ‘strongly recommended’ the gallery buy the painting.12 Perhaps Churcher should have realised as soon as she was approached by Bleakley that the Cook painting was more trouble than it was worth, but she believed strongly that it belonged in Australia. Her response to the doubts raised by a cynical press was that it was okay to buy the painting because Sotheby’s was acting for the vendor.13
The National Gallery’s council, however, was far from convinced that the purchase was safe. The price had been halved with suspicious speed, which suggested the seller was desperate, and gossip indicated that Bond was still the owner. So while it was agreed to press ahead with the acquisition, it was only on condition that Sotheby’s produce evidence of the provenance—or origin—of the work.
Provenance is very important in the art world, and when paintings disappear in mysterious circumstances one needs a cracking good story to get them back onto the market. But Bleakley had one. Having assured the gallery that he was definitely not acting for Bond and that his principal had ‘no current connection’ with the bankrupt art collector, he said:
It may be of assistance to you and your board to understand the way in which I became aware of the painting’s availability on the market. By sheer coincidence, I was advised through a contact in the film world in New York that his wife, who is an Englishwoman, wanted to talk to me about a painting that could possibly be of interest to Australia. I knew that she was from a wealthy English family and that her father was prominent in international business affairs. You can imagine my astonishment when I learned that the painting was the Webber portrait of Captain Cook.14
One can imagine the auctioneer’s astonishment, indeed, when it also turned out (by another sheer coincidence) that Lady Nevill was the mystery vendor’s agent.
But Bleakley’s account of the meeting in New York was far more astonishing for what it did not reveal. As he admitted on oath in 1996 when examined about these matters, he was given the name of this wealthy English businessman, yet never bothered to contact him to confirm the story or ask about the painting. Nor did he talk to the man’s daughter, the Englishwoman. Instead, he went straight to Bond’s art dealer Angela Nevill to ask whether she was involved in the sale—which she was. Even then, he did not ask Nevill to verify what he had been told about the vendor—for whom she was acting. As Bleakley also admitted on oath, he had known since May 1992 that the Portrait of Captain Cook was one of several Bond paintings that had been sold to George Way for a great deal less than their real value, because he had read about it in the West Australian newspaper. And he agreed that the circumstances of this supposed sale had made him suspicious.
Q:
What you learn as you read this is that pretty soon after the Bond corporate collapse apparently a significant aspect of the Bond art collection was sold at what appeared to be an extraordinarily low price?
A:
Yes.
Q:
And obviously that would raise a question mark in your mind about the genuineness of the transaction. You don’t know, but it’s a question mark?
A:
Yes …
Q:
Obviously you lodged in the back of your mind just a question mark, ‘This is something, if I’m going to be dealing with these works of art, the lawyers will have to have a look at?’.
A:
Yes.
Q:
You looked at this yourself and thought ‘This looks like a sham price’, didn’t you?
A
I did.15
Even more to the point, Bleakley knew that Angela Nevill had received several of the Bond paintings because he had actually sold two of them for her in 1992 and split the 10 per cent commission.
According to Nevill’s sworn evidence in August 1996, she made it clear to Bleakley that the two artworks he was selling on her behalf formed part of the Alan Bond collection. She also made it clear that the vendor was still ‘associated with the Bond family’. And Bleakley admitted as much to the liquidator’s lawyers in 1996. When asked on oath who was the vendor of one of these two lesser paintings, he replied:
A:
I believe it was a Bond entity of some sort … I mean, I knew that it was formerly in the Bond collection.
Q:
You knew that it was one of the paintings that was the subject of the George Way transaction, didn’t you?
A:
Yes, I did.16
But if Bleakley had any concerns that the Portrait of Captain Cook might also be being sold by someone connected to Bond, he did not tell the National Gallery. Instead, he assured them and everyone else that the valuable painting had nothing to do with the bankrupt entrepreneur, telling Terry Ingram of the Financial Review in July 1993, ‘We have been assiduous in this instance, as you can imagine. I am convinced that the work does not belong to Alan Bond’.17
In fact, Bleakley had still not asked Angela Nevill who owned the famous painting, and had still made no attempt to confirm his New York story about the ‘wealthy English businessman’. But he had obtained a letter from Angela Nevill assuring him that the Captain Cook was not being sold ‘by Alan Bond or any company affiliated with him’, and he would argue on oath in 1996 that it was perfectly reasonable to rely on this assurance.
He did not tell the press that he was selling the painting on behalf of Bond’s art dealer and sharing her commission.18 The National Gallery, however, soon found out about Lady Nevill’s involvement for themselves. In early August 1993, the gallery’s Assistant Director, Collections, Michael Lloyd, hopped on a plane to Switzerland to inspect the painting, only to be met by Nevill and escorted to a huge bonded warehouse at Zurich Airport called the Zuricher Freilager.
The fact that the painting was under lock and key there, so close to Jurg Bollag’s home town, may well have rung more alarm bells for the prospective purchasers—not least because the Freilager was as secure as a Swiss bank and as safe from prying eyes.19
Be that as it may, in one of the strongrooms a Swiss restorer scraped away at the surface of the painting under Lady Nevill’s watchful eye and pronounced it to be in pristine condition, while Michael Lloyd took a colour slide to show to the folks back home. This left only one remaining problem, which was how the hell the great explorer’s portrait had got there and who was selling it if Bond was not.
This was certainly what was exercising the mind of Lionel Bowen, chairman of the National Gallery’s council, who felt it was extremely unwise to buy the painting on trust when Bond was being so publicly investigated in Australia for all manner of alleged crimes, including concealing assets from his creditors. ‘It had been in Perth and ended up in Europe, and we wanted to know how it had got there.’20 A lawyer in the Australian Government Solicitor’s office, Peter Lundy, was therefore commissioned to trace the history of the painting since its disappearance in 1990.
It did not take Lundy long to determine that the Portrait of Captain Cook had vanished in January 1990 after being sold to George Way for a fraction of its real value. Nor was it hard to discover that the Bond Corp liquidators believed they had a claim over the painting. And he soon learnt that the Australian Securities Commission had been asked to investigate the 1990 ‘sale’ to Way for suspected breaches of the law.
Lundy obtained legal advice from a Perth QC, Eric Heenan, that it would be unsafe for the National Gallery to buy it, but Churcher and Lloyd were so keen to get the painting for Australia that they demanded a second opinion. Next, Lundy consulted one of the world’s experts, a Paris-based lawyer called Van Kirk Reeves who advised New York’s Guggenheim Museum, and came back with the same verdict. But even this did not suffice. So his third stop was London in January 1994, where he discussed the matter with Angela Nevill, face to face.
Of course, Nevill knew full well that the painting belonged to Bond, because it had been in and out of her sight for the previous four years, and because she had discussed it regularly with Alan and his acolytes. It had been delivered to her in January 1990 only a week after being shipped from Australia and she had then arranged storage. Two months later, she had met Michael Cross, Alan’s managing director at Dallhold, to discuss plans for selling it. And two months after that, in early May, she had met Alan himself in London and agreed to send a photograph of the Captain Cook portrait to a potential purchaser. Thereafter, she had taken instructions from Jurg Bollag, whom she knew to be Bond’s agent, over the attempted sale of the painting to the National Gallery.
Nevill told Lundy none of this. Instead, she assured him that the painting had passed through a couple of ‘European collections’ since its sale to Way, and offered to enter a contract with the National Gallery in which her firm, Nevill Keating Pictures, would act as the vendor. She refused, however, to give guarantees that her gallery was the rightful owner or to pay compensation should the painting be repossessed. Lundy thought her ‘pretty evasive’ and reported back to the National Gallery that the proffered contract was ‘legally worthless’.21
Yet even now, after three rebuffs, Churcher and Lloyd were not prepared to give up, and for the next several months letters and contracts were batted back and forth by Nevill, the gallery and Sotheby’s, in an attempt to frame guarantees that would be acceptable to both sides. Eventually, all was in vain. Nevill’s inability to demonstrate that Bond was not selling the Captain Cook made the gallery realise it was absolutely essential to be told who was. And Nevill could hardly do that. If she had told the National Gallery about the painting’s travels since its ‘sale’ to George Way, they would almost certainly have run a mile. And had she explained to them that the latest official ‘owner’ (come 1994) was an untraceable offshore company called Transit Trading Ltd, run by Alan Bond’s notorious Swiss banker friend Jurg Bollag, they would doubtless have run further still. She would also have had the Bond Corp liquidator and Bond’s trustee in bankruptcy banging on her door and demanding the painting be handed over.
So, after almost eighteen months of negotiations, both sides had reached a stalemate, and at the end of 1994 Churcher, Lloyd and the National Gallery were forced to conclude that they could not safely buy the picture, however much they wanted to.
But that did not mean that the doughty Captain’s voyages had come to an end.