Ex-gallery boss gets jail in NYC art fraud

[July 20, 2011]  NEW YORK (AP) -- An art gallery director convicted of selling works without telling their owners was sentenced Tuesday to four months of weekends in jail, closing a case that spiraled out of her former boss' star-studded $120 million scam.

"I'm very sorry for causing people pain and suffering," Leigh Morse said before hearing her sentence, which will start the weekend of Aug. 6. She also was ordered to pay a total of $1.65 million in restitution to four artists' estates she was found guilty of scheming to defraud.

The verdict came in April after a trial that brought Robert De Niro to the witness stand because Morse was accused -- but acquitted -- of a grand larceny charge involving his artist father's estate.

Morse, 55, ran the now-defunct Salander-O'Reilly Galleries. Its owner, Lawrence Salander, is serving at least six years in prison after pleading guilty to fleecing clients including John McEnroe and Robert De Niro Sr.'s estate through phony art investment opportunities and sales of pieces he didn't own. He also kept sale proceeds he should have given to artists' families and others who entrusted him with pieces to market.

Morse was a smaller piece of the fraud enveloping the gallery, prosecutors said. She kept artists' estates in the dark about sales of more than 80 works, dissembling after some began inquiring where the artworks were while collecting her commissions on the sales, prosecutors said.

She was also charged with but cleared of pocketing $77,000 in proceeds from selling two paintings by De Niro's father.

The abstract expressionist selected Salander to represent his work, and his son continued the relationship after his father's 1993 death. But De Niro told jurors at Morse's trial that he eventually learned that Salander had signed over ownership of some of his father's work to an Italian gallery without his permission, and that the estate hadn't been paid its portion of any sales after 2001, he said.

De Niro severed ties to the gallery around the end of 2007 and rejected efforts by Morse and another staffer to get the estate's business back, he said.

Morse's lawyer, Andrew M. Lankler, said during the trial that Morse had no part in Salander's schemes, wanted clients to get what was due to them and was out $300,000 in commissions herself when the gallery collapsed.

State Supreme Court Justice Michael Obus said Tuesday he was convinced Morse "had no intention of getting herself involved in criminal conduct like this.

"But there did come a time when the defendant had a decision or a series of decisions to make, and that was to either participate in fraudulent conduct or not. And the jury found that she did participate," Obus added. "This is not a failure to be heroic. This is about a betrayal of trust."

Morse later opened her own gallery. She supports her disabled husband, a fact Obus said he took into account when deciding her sentence.

Lankler declined to comment after the sentencing.

[Associated Press; By JENNIFER PELTZ]

Jennifer Peltz can be reached at http://twitter.com/jennpeltz.

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