The Billionaire, the Dealer and the $186 million Mark Rothko's No. 6

On a sunny morning in late February, Yves Bouvier, a Swiss art dealer, flew into Nice and drove 20 miles along the French Riviera to Monaco to meet his top client, Russian billionaire Dmitry Rybolovlev. Bouvier had come to work out the final payment for Mark Rothko's No. 6 (Violet, Green and Red), which Rybolovlev had agreed to buy for 140 million back in August. Bouvier, 51, entered the lobby of the cream-colored, belle époque mansion where Rybolovlev's penthouse apartment overlooks Monte Carlo's yachtfilled marina.
Assuming business as usual, Bouvier approached a man he thought was one of Rybolovlev's bodyguards.He was wrong, Bloomberg Markets magazine will report in its June 2015 issue. The man turned out to be one of eight Monaco police officers who were there to arrest him. Bouvier didn't know that six weeks earlier, Rybolovlev had filed a complaint against him for fraud, alleging Bouvier had misled him about the prices of artworks he was buying.
That evening, while Bouvier sat in a Monte Carlo police station, Rybolovlev, majority owner of AS Monaco Football Club, was celebrating with Prince Albert II at London's Emirates Stadium: His team beat perennial English powerhouse Arsenal, 3-1.

The dispute between Bouvier and Rybolovlev has turned into one of the biggest cases of alleged fraud to ever hit the art market, pitting one of Russia's richest men against a little known Swiss art merchant. Rybolovlev, a 48-year-old cardiologist-turned-businessman from the Urals region, made most of his $10 billion fortune through the sale of his ferti lizer company, Uralkali, in 2010. Using a series of offshore companies during the past decade, he's spent more than $2 billion buying almost 40 works of art through Bouvier, amassing a dream collection of works by Picasso, Leonardo da Vinci, Rothko, Gauguin, Matisse, and Rodin.

Bouvier owns an art shipping company along with stakes in a network of freeports-bonded warehouses where the superrich can store paintings, wine, and antiques tax-free. In the past five years, he's exported the freeport concept from Geneva to Singapore and Luxembourg. All the while, operating below the radar, he's quietly become one of the biggest art dealers in the business.
After three days of questioning, Monaco's Public Prosecution Department indicted Bouvier on criminal charges of fraud and complicity in money laundering and released him on 10 million ($11 million) bail. As part of the alleged fraud, the indictment cites the sale of the Rothko-one of his best-known works, its bold rectangular blotches bleeding into one another.

The Monaco complaint alleges Bouvier fraudulently inflated invoices for some of the artwork Rybolovlev bought and may have "secretly withheld part of the sale price." The prosecutor charged Tania Rappo, Rybolovlev's translator and godmother to his second child, with money laundering in connection with the commissions Bouvier paid her as an intermediary. Frank Michel, Rappo's lawyer, says her commissions were "perfectly legal and justified." Bouvier denies he was complicit in any money laundering and says commissions paid to those who introduce a buyer to a vendor, as Rappo did, are normal in the art world. If convicted, Bouvier could face up to five years in prison for fraud and 10 years for complicity in money laundering. He denies the charges. The showdown in Monaco has blown the lid off an opaque area of the art market: private sales, in which the most sought-after pieces often change hands through well-connected dealers, avoiding a public bidding war.Of the record 51 billion in art sold last year, 52 per cent of the transactions were private deals, says Clare McAndrew, founder of research and consulting firm Art Economics.