Psst, wanna buy a Picasso?

Buying dodgy art

On March 7 last year, Russell Grant-McVicar walked into the Lefevre Galleries in London's West End. He had tied his hair in a bun but apart from that he was undisguised. Pointing at a picture of a wonky-looking woman, he asked if it was a Picasso. On learning that it was, Grant-McVicar indicated that he was in possession of a sawn-off shotgun, seized the £750,000 painting from the wall – in full view of the gallery's security cameras – and leapt into a waiting taxi. On arrival at his destination, he left the driver a £10 tip and the frame which he had covered in fingerprints while removing from it Picasso's Tete de Femme.

For Grant-McVicar, 33, snatching a Picasso was the big time. As a rule, he robbed branches of NatWest and Thomas Cook. This, though, would make headlines. And so it did. The insurers offered £50,000 for leads. Another big reward, another art heist, just another everyday meeting between low life and high art.

The current value of art known to be missing amounts to some £1bn. The vast majority is by little-known artists, but big names are disappearing too. According to recent figures, 355 Picassos are missing, along with 271 works by Miro, 250 Chagalls, 180 Dalis, 121 Rembrandts, 119 Warhols and 115 Renoirs.

One major Japanese bank recently asked experts to examine 1,000 works of art which came into its possession following the Tokyo property crash a few years ago. The total value of those works is estimated to be £1bn. But experts believe a substantial number will turn out on examination to have been snatched by men like Grant-McVicar.

Each year, robbers take enough precious work to fill a gallery the size of the Royal Scottish Academy several times over. Not just amateurs like Grant -McVicar but organised crime groups more usually involved in drugs and arms deals. “People are out there nicking paintings and fine art all the time,” declares Peter Gwynn, of the leading insurance syndicate Hiscox.

Grant-McVicar didn't work alone either. Peter Scott was a self-styled “gentleman thief” who once stole a pair of knickers from Sophia Loren during a career as a cat burglar which also took him into the homes of Elizabeth Taylor, Judy Garland, Mia Farrow, Ginger Rogers and Zsa Zsa Gabor. He even wrote a book, Gentleman Thief: Recollections of a Cat Burglar, in which he boasted that his nickname was “the Human Fly.” But for 10 years Scott had avoided crime, living in a one-bedroom flat in Islington, earning £10 an hour as a tennis coach. That's how he met Grant-McVicar.

For a £70,000 fee, Scott agreed to sell the Picasso. But he had lost his touch. Within seven days of the raid, everything went horribly wrong. Another accomplice, Ronald Spring, 70, agreed to help the police by setting up a meeting at which Scott was caught red-handed. The location of the meeting was exquisite: a hotel in central London called the Sherlock Holmes.

Grant-McVicar later told a jury that he had acted on the orders of the “most powerful cult on the planet.” It didn't wash. All three men were duly convicted.

As that saga drew to a close at Snaresbrook Crown Court in East London this month, across the continent art thieves made another high-profile strike. Armed robbers made their move on Rome's National Gallery of Modern Art after closing time. The skeleton night staff – three unarmed women – were bound and gagged in a bathroom. Two Van Goghs (Le Jardinier and L'Arlesienne) were taken, along with a Cezanne (Le Cabanon de Jourdan). Rather more professional than Grant-McVicar, these raiders took care to remove the videotapes from the closed circuit TV.

Only days before this, at the Louvre in Paris, another set of thieves had used knives not guns, slashing Camille Corot's The Sevres Road from its frame and carrying it off during opening hours. Hundreds of visitors to the museum were locked inside and subjected to a body search – but it was too late.

Robberies from galleries are just the tip of the iceberg. This month, a £40,000 painting by Scottish artist Edward Atkinson Hornel was taken from the home of a 98-year-old Glasgow woman. That story had a happy ending: the painting was returned by courier six days later, probably because media coverage had made it impossible for the thieves to sell. But such endings are uncommon. No one has found the priceless silverware taken from Sir Walter Scott's Abbotsford House in 1994. The police have other things to worry about. “Arson, rape and terrorism are more important than a picture stolen from some colonel in his manor,” says James Emson, of Art Loss Register, which receives around 1,200 notifications of theft each month and helped uncover a missing Delacroix before Christmas. Another crimebusting art organisation is Trace, a monthly magazine circulated to police forces across the country and overseas, to libraries, auction houses and embassies, which recently helped a Sheffield man recover £60,000 of stolen property, and spotted a pair of stone lions, stolen from Dumfries, in Chelsea. But neither outfit can claim to have a good recovery rate. Too much is being taken.

But what on Earth do people do with all this art when they have it? Unlike dodgy mobile phones, video recorders and Levis, you cannot just flog a Picasso down at your local pub. Without a market, how can a picture have a market value? Popular myth suggests art thefts are commissioned by big-time villains – ethically challenged but aesthetically aware Dr No figures, criminal masterminds who adorn their mountain top/ underwater/ desert island hideaways with Old Masters. Fragments of evidence occasionally back up this theory: in this month's raid in Rome, the robbers left behind several more valuable paintings – as though they had been acting on a particular commission. Likewise, in 1984, four out of five works by Corot, stolen from a French museum, turned up together in Japan – suggesting they'd been taken for a single customer.

Yet experts tend to be scornful about the idea of big-shot collectors: “That's crap,” says Charles Hill, one ex-policeman now working for insurer Nordstern. “Blofeld and Dr No do not exist.” Detective-sergeant Dick Ellis of Scotland Yard agrees that art is rarely stolen for artistic reasons: “This is not art for art's sake.”

“If I have nicked a Cezanne,” Gwynn explains, “I have about £10 of canvas: there's no intrinsic value. So I have to swap it. Then I have half a million pounds.” How is such alchemy effected? If you have a dealer willing to ask no questions, you might, just might, be all right. Or conceivably you – the criminal – might just give the painting back and pick up the reward, if there is one. But insurers strongly deny ever paying ransoms. “If I thought an informant had something to do with the robbery,” Gwynn says, “I would not have anything to do with him because that makes me just as corrupt.”

The most likely way an art crook makes money is by tricking a bank into advancing money against a painting or antiquity without establishing the authenticity of the work, or the owner's title to it. One bank heavily involved in lending against art, Coutts, refuses – understandably – to accept works as collateral unless clients have been with the bank for years. Incredibly, however, other banks still fall for this old ruse.

Major pieces stay underground, passing from one crook to another with a black market value about one-tenth as high as the legitimate value. The Van Goghs and the Cezanne stolen in Rome are too well known to be sold on the open market or used as collateral for loans. The robbers will more likely treat them like loan notes. Testimony from Italian Mafia trials depicts a world in which Caravaggio's Adoration, stolen in 1969, would be frequently passed from Mafia boss to Mafia boss as collateral before finally being destroyed.

Where the Mob go, terrorists follow. One of the most successful recoveries of all time involved art stolen by Irish paramilitaries – including Martin Cahill, the subject of John Boorman's film The General – from outside Dublin in 1986. One policeman involved was Nordstern's Charles Hill. “The pictures stolen by Cahill and his gang were in a vault in Luxembourg. But we took him out on a sting, said we were representing a person in the Middle East.” Working with the police, a Belgian dentist offered to lend the robbers £1m on condition that four paintings were deposited as collateral in Antwerp. The robbers intended to buy a stake in a bank in Antigua with the proceeds. This in turn would enable them to launder the profits from drug deals – for the subsequent purchase of arms. And so they might have, if the trap sprung by the police had not worked. Two other pieces from the same collection subsequently turned up in a heroin swap in Turkey.

No wonder, then, that the Metropolitan Police brought its arts and antiques squad under the wing of its organised crime group in 1996. That said, not all major art crime is undertaken by gangsters. Gwynn, who worked for the police before joining Hiscox, recalls recovering a Brueghel stolen from the Courtauld: “It was on a gas fitter's wardrobe in Dulwich,” says Gwynn. “He was just looking after it.”