Toxic Philanthropists : The Do-Gooders Who Mask Their Misdeeds by Way of Donations

The term “toxic philanthropy” has once again surfaced as several artists made a show of support to activists calling for the resignation of “Warren Kanders”. Eight artists whose works are on exhibit or supposed to have gone on exhibit at the ongoing Whitney Biennial, withdrew their artwork.

 

They did so after learning that the reason why Warren Kanders is being asked to resign from the museum board, is because he made his fortune by being chief executive to the tear gas maker Safariland. The brand of tear gas being used on refugees seeking asylum in different borders, including those entering the U.S. Mexico Border.

 

They are also called “philanthrocapitalists” who take form as wealthy do-gooders claiming to change the world and speak reverently of global poverty, but rarely examine how their business is contributing to poverty and inequality.

Another Example of Toxic Philanthropy: Sackler Family of Purdue Pharma

 

 

The Sackler family name linked to the Sackler Gallery at the Metropolitan Museum of Art, has recently been taken down in several museums and other institutions. This was after art activists launched month-long protests over the acceptance of dirty money coming from toxic philanthropists as funding support for galleries.

The protest actions came about when word spread out that the Sackler family is the owner of Pharma Purdue, manufacturer of the addictive painkiller OxyContin. The problem with OxyContin was that Purdue Pharma did not disclose the addictive ingredient, which spurred the so-called opioid crisis. Doctors prescribed OxyContin as painkillers to hundred of patients, many of whom become drug addicts and at worse, died.

 

Since the Sackler family is well-known as philanthropists and benefactors of arts, lawyers were able to keep the family name from being dragged to court, and by entering into out-of-court settlements.

French Art Works Auctioneer Collects €41.3m from Sale of Aristophil Collections

French auction house Claude Aguttes SAS, one of four auction houses assigned by France’s Tribunal de Commerce (Commercial Court), reported that up to April 15 of this year, as much as €41.3 million in revenues have been realized from auction sales of the Aristophil Collection. Claude Aguttes’ designation as auction house for the said collection was in line with the Tribunal de Commerce’s handling of the receivership and liquidation of the scandal-ridden and bankrupt Aristophil company.

However, the €41.3 million revenue achieved by the Claude Aguttes SAS, auction house, plus the more than €140 million cash and assets sequestered from the Aristophil company and from the Lhéritier family, is still a long way off from the €850 million collected from Aristophil investors. When the investment scheme came under investigation in 2015, it was unraveled as an organized fraud that promised overstated returns on an investment product that was not as highly lucrative as it was purported to be.

What was the Aristophil Company’s Investment Scheme?

The Aristophil Company was an entity founded in 1990 by Gérard Lhéritier, a former insurance broker. Lhéritier cooked up an investment scheme by enticing people to expend money to be used in buying, and then selling precious documents and historical manuscripts. Through the Aristophil company, Lhéritier promised investors that the money they contributed will earn as much as eight percent (8%) per annum.

In fact, the Aristophil company even opened a small museum and named it Musée des Arts et des Lettres, displaying about 130,000 precious documents, which soon drew attention and attracted more investors. The museum held a rich collection, including manuscripts produced by the likes of Victor Hugo, Proust, Balzac, of the Marquise de Sade, and even by American President John F. Kennedy. Investors were assured therefore that the money they contributed were being properly invested, which all the more made them sure that they made a wise investment.

As it turned out though, Aristophil was paying returns on investments using fresh funds collected from new investors to the scheme. Similar to Bernie Madoff’s Ponzi scam, the fraudulent set up collapsed when the company was no longer successful in enticing new clients. The company’s subsequent bankruptcy led to the investigation of how the Aristophil company operated.

In March 2015, Gérard Lhéritier was found guilty of deceptive marketing methods, breach of trust, organized fraud, misuse of corporate assets, presentation of unfaithful accounts, and money laundering, Aristophil company was immediately placed under receivership in February 2015, and later into liquidation in August, 2015.