It is not difficult to imagine how this regrettable situation might happen, if no designated client account exists. When times are tight, sale proceeds for auction firms that don’t protect vendor monies can become a significant part of that firm’s cashflow.
In making such client protection mandatory for its members, The Auctioneers and Valuers Association of Australia (AVAA) – whose ranks didn’t include Mossgreen - is echoing the stance of its UK counterparts, NAVA Propertymark and RICS.
Fine art auctioneer body SoFAA insists that all its members have a separate client account or use an alternative method of protecting client funds that has been approved by its committee.
In 2004, following the collapse of a subsidiary of Coys, Bonhams became the largest UK-headquartered fine art auctioneer to set up separate client trust accounts for vendors to protect their money during the sale process.
It renewed its campaign to urge all auctioneers to follow suit in 2012, following Auction Atrium’s collapse.
At the time chairman Robert Brooks noted that, “in any other industry, that money would be protected, but not in our market. It’s 19th century stuff”.
What do you think?
It’s hard to dispute the argument that consignors are the bedrock of any auction house but doesn’t this mean those clients should expect protection of their sale proceeds?
Tell us what you think by emailing firstname.lastname@example.org or writing to the Editor, Antiques Trade Gazette, 65 Southwark Street, London SE1 0HR.