CHAPTER 8 - The Well Never Ran Dry

Donald Austin, the Chicago-area owner of Austin Galleries, was convicted by a federal jury in October 1993 of eight counts of mail fraud for sales through his 30-gallery chain that once stretched from Chicago to San Francisco. Prosecutors estimated that consumer losses totaled as much as $3.8 million in purchases of fake Dalis, Picassos, Chagalls and Miros, some of which were the wrong size, color and image.

Defense attorney Luis Galvan described his client as the "Kmart of the art world...always looking to put up the next blue-light special." Assistant U.S. Attorney Gillum Ferguson pointed out that Austin had marked up $1,500 prints to as much as $13,000.

"That's the kind of mark-up Kmart would envy," he said. The jury took only 90 minutes in reaching the verdict.

In June 1994, Donald Austin was sentenced to eight-and-a-half years in prison and ordered by U.S. District Judge Marvin E. Aspin to pay $505,000 in restitution to defrauded customers.

Five months earlier, Michael Zabrin, who pleaded guilty to a single count of mail fraud and cooperated with prosecutors in the Austin case, was sentenced to one year in prison. He also paid a fine and was placed on three years probation.