The Cheat Sheet

L’Affaire Aristophil, a very French scandal

Jinoy Jose P | Updated on February 27, 2020 Published on February 27, 2020

The name seems to have a literary aura around it…

Touché! Today we are discussing one of the most profound and intellectually appealing scandals ever to have visited the world of finance — all thanks to, allegedly, Monsieur Gérard Lhéritier, who, according to a brilliant profile by David Segal that appeared recently in the New York Times, was once billed the ‘King of Manuscripts’.

Manuscripts? You mean rare ones?

Indeed. Lhéritier is accused of having run one of the most interesting Ponzi schemes that France, or perhaps the world, has seen in recent history — a feat that conferred him with a new title, the (Bernie) Madoff of France. For context, Bernard Lawrence Madoff is an American investment honcho who is now n prison serving a 150-year sentence after he was convicted of running a massive Ponzi scheme that robbed investors of nearly $70 billion in 2008-09. Lhéritier, on the other hand, is accused of duping people $1 billion in his art Ponzi scheme, billed the largest in French history.

OMG! Never knew old manuscripts could rake in so much moolah.

Well, rare books and artworks have always attracted thieves and crackpot investors. For instance, in the book The Man Who Loved Books Too Much: The True Story of a Thief, a Detective, and a World of Literary Obsession, journalist Allison Hoover Bartlett talks about a notorious rare manuscript thief and an amateur biblio sleuth who chased him. Another example is The Map Thief: The Gripping Story of an Esteemed Rare-Map Dealer Who Made Millions Stealing Priceless Maps by journalist Michael Blanding.


Coming back to Monsieur Lhéritier, he claims he was neither thief nor fraudster. He didn’t fake the manuscript or forge documents. As the NYT feature explains, Lhéritier owned rare artworks and manuscripts — a letter from painter Frida Kahlo (signed and twice kissed with red lipstick); a page with calculations by Isaac Newton and a handwritten speech by John F Kennedy from 1953.

Then, what was wrong?

According to French authorities, Lhéritier cleverly devised a finance scheme modelled on Italian swindler Charles Ponzi’s classic, and proverbial, con job. He first put a price on the manuscripts he owned and then, based on their value, created a financial scheme where anyone could own a slice of the work’s value and get rich dividends as the ‘value’ appreciated. Mind you, Lhéritier’s company Aristophil, founded in 1990, claimed one of the largest collections of rare works — 1,36,000 units.


Everything was going hunky dory with Lhéritier and Aristophil until 2014, when he bought a manuscript of Marquis De Sade’s 120 Days of Sodom for $10 million from its Swiss owner. Interestingly, the French government was also after the manuscript. Even though Lhéritier told the French National Library it could display the document a few years later, if the government allowed him some tax cuts, the deal didn’t go down well with both parties. Soon, activities of Aristophil and its owner came under the government scanner.

This is exciting.

The authorities soon got their moment, through some of the investors in Lhéritier’s art-finance scheme. Some 18,000 people had already bought the ‘shares’, and their investments had totalled $1 billion. But when some of them tried to sell their stakes and recoup the money (they were initially told their shares would be bought back with around 40 per cent gains five years later), they realised the scheme was all hot air and the money-chain survived only on new subscriptions; all the money had kind of vaporised. The value attributed to the works were blown up to bizzare proportions by Lhéritier.

There you go!

Soon, French authorities shut down Aristophil and nabbed Lhéritier. Ever since, the authorities have been on a mission to auction off the rare works the company owned and refund investors. Lhéritier looks at 10 years in jail, as rare manuscripts continue to lure dangerous and quirky minds — the most recent example being Gregory Priore, former archivist at the Carnegie Library in the US and John Schulman, owner of Caliban Book Shop, who pleaded guilty to stealing $8-million rare texts from the library. More on that, later.

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Published on February 27, 2020
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