Leon Black, a prominent figure on the board of New York’s Museum of Modern Art (MoMA), reportedly circumvented capital gains taxes on high-value art transactions with financier Jeffrey Epstein by leveraging a tax clause, as reported by the New York Times. These transactions are now part of a Senate investigation probing Black’s ties to Epstein.
In February 2021, over 150 artists and cultural figures publicly called for MoMA to sever its association with Black through an open letter initially published by Hyperallergic. Following this pressure, Black resigned as chairman of the board in March, though he continues to serve as a trustee.
On November 23, 2016, Black sold Alberto Giacometti’s bronze sculpture “Figure Moyenne II” (1947) for $25 million to the Haze Trust, a fund managed by Epstein, as per documents reviewed by the New York Times. Epstein was a registered sex offender at the time. Concurrently, a Black-affiliated company allegedly used the sale proceeds to buy Paul Cézanne’s “Portrait de Vallier de Profil” (1906) for $30 million. This transaction was organized as a 1031 exchange, allowing tax deferral on capital gains by reinvesting in a similar asset, a practice no longer applicable to art after the 2017 Tax Cuts and Jobs Act.
In a similar maneuver, one of Black’s art entities reportedly sold Georges Braque’s painting “Le Guéridon” to Epstein’s trust for $5 million, subsequently using the profits to acquire another Cézanne piece. Sloane & Company, representing Black, stated, “The New York Times reporting confirms the Dechert Report’s public findings more than two years ago that Mr. Black paid Epstein for legitimate financial advisory services. The 1031 exchanges used in this 2017 art transaction were completely legal and appropriate.” MoMA has not responded to repeated inquiries for comment.
The Senate Finance Committee’s ongoing investigation, initiated in June 2022, has highlighted significant tax issues and concerns related to trusts and structures Black utilized to potentially bypass over $1 billion in future taxes. On July 25, Senator Ron Wyden of Oregon sought clarity from Black on the substantial payments made to Epstein, questioning if they were correctly reported for tax purposes. Despite having an art collection valued at $1 billion, Black has yet to furnish the Senate with documentation justifying the $158 million paid to Epstein for tax and estate services between 2012 and 2017. This inquiry coincides with a July lawsuit accusing Black of sexual misconduct, allegations he denies, and a $62.5 million settlement with the US Virgin Islands to preempt potential charges from their investigation into Epstein’s sex trafficking activities.
