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The fox and the oligarch

The first favour Yves Bouvier did for Rybolovlev, free of charge, amounted to a charm offensive that, like La Fontaine’s fox, lured the Russian into dropping a cheese worth several hundred million francs. Chagall, Picasso, Modigliani, Van Gogh: their initial encounter, whether fortuitous or not, led to the assembly of a collection worthy of Le Petit Trianon. This is the third episode of our series.

Yves Bouvier et Dmitri Rybolovlev | Anne-Gaëlle Amiot for
Yves Bouvier et Dmitri Rybolovlev | Anne-Gaëlle Amiot for

And so, dear reader, we come to the founding moment, without which the third episode in this series about the extraordinary career of a Genevan shipper could not begin. However, as with all crucial instants, several versions of the story exist.

Read the full French version here

What we know for sure is that the scene takes place in August 2002 at Geneva Freeport, an institution that even Genevans are only hazily aware of, but which nevertheless holds goods insured for a total value of over $100 billion. At stake in this first meeting is a painting by Marc Chagall, Le grand cirque, which the artist painted in the second part of his life

On every other detail, the stories diverge. Let us concentrate, for starters, on the version of the boss of Natural Le Coultre (NLC), a Genevan removals company that has,over the years, been transformed into a shipping company for artworks. NLC is, at the time, a major tenant of the Geneva Freeport. Yves Bouvier was 39 years old at the time. He is blond and simply dressed and has a Genevan accent that makes him immediately likeable. He tells us how, from the lobby of the Free Ports, with their bright-red sofas, he observed a man a little way off shouting into a phone. “He was quivering with rage. He has just acquired a major painting by Chagall, but the certificate of authenticity was missing. What’s more, the painting was due to go out on loan to a museum in Israel for three months. To his mind, he’d been swindled.”

“He” refers to the Russian Dmitry Yevgenyevich Rybolovlev, who in August 2002 was not yet 36 years old but already a billionaire. He had moved his family to Geneva seven years earlier and was shuttling back and forth between there and Russia, but spoke neither English nor French. He was accompanied by a Bulgarian socialite called Tania Rappo who appeared to be acting as his guide and interpreter. Yves Bouvier stepped forward and offered his services, which helped to calm the oligarch’s temper.

“I knew the person selling the Chagall,” Yves Bouvier tells us seventeen years later. “It was a complicated sale to a group of middlemen and behind it all was a professional dealer and owner. Naturally, I reassured Mr Rybolovlev and had the certificate of authenticity forwarded to him a few days later.”

“Frustrated at being their valet”

Once the certificate had been handed over, Yves Bouvier asked Tania Rappo to set up a meeting. The Rybolovlevs’ helper, who was 51 when this encounter took place at Geneva Freeport, will play a major role in this whole story. She is married to a dentist who treated the Russians. Tania is as extrovert as Dmitry and his wife, Elena, are reserved. The Russian billionaire later told the police that he “trusted her and that trust rubbed off on Yves Bouvier.” In her book The Bouvier Affair: A True Story, the American journalist Alexandra Bregman posits that “Tania Rappo was secretly frustrated at being their valet”. The Russian couple seemed to have no inkling of her state of mind, because in 2001 they invited their Bulgarian chaperone to be their second child’s godmother. This is how the oligarch described their relationship during a court hearing in Monaco in 2017: “I very soon came to trust her. For example, if I rented a house or a boat for the holidays, she and her husband would come along. Those were the kind of circumstances in which she spent a lot of time with us. In fact, she said, ‘Oh, how I love the billionaire lifestyle!’”

In Rybolovlev’s version of events, there was nothing accidental about their first meeting in August 2002. Having realized that the walls of his home in Cologny were fitted with special lamps designed to show off paintings at their best, Dmitry also discovered that the house’s previous owner had owned a Chagall. Thus inspired, he decided that he would like a Chagall as the first piece in his future collection and so, naturally, he requested Tania Rappo’s assistance. She identified Le grand cirque, got in touch with a gallery in Baden-Baden, which offered her the painting for 8 million Swiss francs, located the owner and negotiated the price down to 5 million.

The Rybolovlev camp claims that Tania Rappo subsequently arranged the meeting at the Freeport in order to introduce Dmitry to someone who could produce the much-discussed certificate. Yves Bouvier “introduced himself as the owner of the Freeport, but I’d never met him before then,” Dmitry Rybolovlev told the Monegasque courts in 2017, according to documents we have seen. Bouvier vigorously denies that he presented himself as the owner of the Freeport, pointing out that the Genevan state is the majority stakeholder.

The potash czar

So the relationship between the mover and the oligarch apparently began with a complimentary favour by the former for the latter. There was, however, a hitch from the very start. As the Genevan state prosecutor’s office found out during its investigations, the payment for the Chagall painting was transferred to a company called Finatrading which the Mossack Fonseca law chambers (the company whose leaked files broke the Panama Papers scandal) registered in the Virgin Islands in 1995. The company’s beneficial owner is none other than Yves Bouvier himself! He didn’t need to look very hard for the missing certificate in order to ingratiate himself with the billionaire.

The man Russian media call the “potash czar”, Dmitry Rybolovlev, was born in 1966 and qualified as a doctor, as did his wife Elena, whom he met at the medical faculty of the University of Perm, his hometown at the foot of the Ural mountains, and married in 1987. Alongside his job as an accident and emergency doctor, Rybolovlev bought and sold foreign beers and then, when privatizations begin in 1992, he and a well-connected business partner snapped up shares that regional state companies had distributed to their employees. At the age of 28, he set up a bank and then trained his eye on Uralkali, the gigantic local potash mine first exploited under Stalin in the 1930s.

This first phase of his rise to riches was in keeping with the practices of the time, in that it occasionally required sending in the heavies to deal with a competitor. This modus operandi rubbed some factory managers and local mafia bosses up the wrong way. In 1995 Dmitry Rybolovlev decided, for safety’s sake, to move his wife and daughter to Geneva, but he continued to fly back and forth to develop Uralkali, of which he only gained complete control in 2000. Arriving back in Switzerland in 1996, he was arrested and accused of having hired the killers of one of his company’s executives, a man called Evgeny Panteleymonov. Rybolovlev spent eleven months in a Russian prison before being acquitted for lack of evidence. One witness retracted his statement, and the victim’s wife pleaded in Rybolovlev’s favour, as did leading local politicians.

“The closest analogy to what Russia was like in the 1990s is the Wild West. Dmitry and his family didn’t know a soul when they arrived in Geneva. They’d come directly from Perm and didn’t speak a word of French or English. They lived completely cut off from the outside world,” someone close them says. Dmitry is an introvert by nature and he isn’t much interested in foreign languages. While his friends describe him as an amazing businessman with a special sense of humour, and his detractors paint him as a cold, paranoid man, above all he was isolated. “As a result, he trusted nobody,” a woman close to him told us. “But once he places his trust in someone, he will always stand by them.”

Yves Bouvier gained this trust thanks to Tania Rappo, who constantly sang the Genevan’s praises to the Russian oligarch. “She raved about Bouvier, telling me how brilliant he was, how professional, and that he always acted fairly,” Dmitry Rybolovlev told the Monegasque courts.

A source close to him confirms this. “Tania Rappo was like a big sister to Dmitry. She would tell him which exhibitions to go to, which artists to look out for and even how he should behave in Switzerland! You can imagine how betrayed he felt when he discovered she’d been going behind his back.”

“The world’s finest art collection”

We haven’t reached that point yet, though. In the summer of 2002 Yves Bouvier provided Dmitry Rybolovlev with the certificate of his first painting, the Chagall. The oligarch was charmed and exclaimed in Tania Rappo’s presence: “This is the man we need!” A different account suggests that it was Tania Rappo who whispered to the Russian: “This is the man we need!”

The Genevan’s own recollection runs like this: “All of a sudden, I’m his saviour. I got in touch with Mrs Rappo, who spoke Russian, and asked her to introduce me to Mr Rybolovlev. I told her that if I made a sale, she would get a commission, as is customary in the art world.” In return for her good and faithful service, Tania Rappo went on to receive the substantial sum of 128 million Swiss francs between 2003 and 2015, paid through one of his many offshore companies.

The oligarch wanted “the world’s finest art collection”, and the mover was willing to provide it. Their first official meeting took place at Belle-Fontaine, the couple’s home in Coligny, which they were eager to transform into Le Petit Trianon, based on plans directly inspired by Marie-Antoinette’s private estate.

According to the Rybolovlev camp, Yves Bouvier stated at this meeting that his knowledge of the art world would allow him to obtain artworks at unbeatable prices for a modest 2% commission. As a shipping agent, he had access to all the important, up-to-date news about artworks whose owners died, divorced or went bankrupt. His position at the Freeport was the icing on the cake. “He told us he was in the perfect position to know what came in and went out,” a source close to the Russian told us.

For this to work, according to Bouvier, he would need to act in total secrecy. If anyone found out he was acting on the billionaire’s behalf or if the billionaire were to get involved in any way, the prices would go through the roof.

This suited Dmitry Rybolovlev just fine; indeed, confidentiality was a precondition for his agreement. “I wanted to go through Mr Bouvier for reasons of confidentiality,” he told the Monaco courts. To be honest, confidentiality appeared to fulfil everyone’s wishes. “Mr Bouvier didn’t want me to tell anyone we were working together,” the Russian oligarch adds, “[…] so as not to let on that he was in actual fact competing with the gallery owners and art dealers who were his freeport clients.”

Let us, however, focus on the 2 per cent, for this is the main bone of contention. Bouvier strongly disputes the Russian’s account, claiming that the 2 per cent reflected only the transport costs and paperwork. “It covered the transport costs, the insurance, certified title deeds, and restoration. Would you take the financial and legal risks I took for 2% of the price of the piece?”

This argument brings a swift response from Nicolas Galley, head of the MA in Art Market Studies at the University of Zurich. “It’s the same as in every sector — the higher the price, the lower the percentage. Thirty-five million in twelve years [the sum of the 2% commissions Yves Bouvier received] is not nothing. That’s a whole lot of paperwork . . . Three million a year is more than most top executives at auction houses earn!”

Yves Bouvier doesn’t agree, and his opinion is backed up by analysis carried out in 2017 by Marc-André Renold, a lawyer in Geneva and professor at the city’s university. He found that the tasks taken care of by Yves Bouvier went far beyond those of a representative and would not be adequately remunerated by a 2% fee.

“Dmitry Rybolovlev wanted me to give my personal guarantee. A firm in the Virgin Islands can go bust overnight. He needed someone to vouch for the work’s condition, its origin, and the certificates of authenticity and ownership.”

The Genevan businessman asserts that he regularly took it upon himself to insure the pieces during shipping. “You can check on any website, but property insurance costs between 1.75 and 6% of the total value of the work!” he exclaims, adding that he considered his role as a seller clear: “If I’d been a representative, I’d have been obliged to show transparency. Mr Rybolovlev and his army of lawyers could have asked for explanations at any point, but they never did!”

Whatever the truth, the fact is that a deal was sealed on the basis of a misunderstanding, and in August 2003 Yves Bouvier organized the sale of a second work to the Rybolovlevs, Vincent Van Goch’s Landscape with Olive Trees, a painting that had been part of Pierre Bergé’s collection, for 24 million Swiss francs. The Russian wanted many more, though. His intermediary knew this, and it spurred him on. He hired Tania Rappo and a certain Sixtine Crutchfield, an art market expert, to put together a huge art fair in Moscow, which opened on 31 May 2004.

“Everyone told him it was impossible,” Mrs Crutchfield is quoted as saying in The Bouvier Affair: A True Story. “He replied: ‘If everyone tells me it can’t be done, then I’ll show them it can.’” The Rybolovlevs attended the event, and it made a lasting impression on them.

Five months after the Moscow World Fine Art Fair, Yves Bouvier sold his first Picasso, The Marriage of Pierrette, to Dmitry and Elena Rybolovlev for 52.6 million Swiss francs. It was painted during the artist’s “blue period” and was thought to be the world’s most expensive painting when it was acquired by a Japanese real-estate tycoon in 1989. The owner’s difficulties probably came to Yves Bouvier’s attention via his personal channels and he bought the painting for 39 million Swiss francs before selling it on to his Russian client at a profit of 12 million francs.

Profit and commission

This is the crux of the matter. Dmitry Rybolovlev was convinced that he had bought the Picasso at the going rate and that Yves Bouvier was a mere middleman, working on a 2% commission. Yves Bouvier, on the other hand, saw himself as an art dealer and therefore regarded it as completely legitimate to buy and sell at different prices. These are the two contrasting views of their business dealings that lingered for over a decade before igniting one of the art world’s greatest ever conflicts.

There were other works in the pipeline. A first Modigliani in April 2006, followed by a second Picasso and a Toulouse-Lautrec in October of the same year, before five sales in 2007, a year that concluded with two Modiglianis — La jeune fille blonde en buste for 29.4 million francs, and Madame Hébuterne aux épaules nues for 28.2 million. Yves Bouvier made a profit of almost 19 million francs on the two paintings, and his lifestyle began to show the effects.

“Mrs Rappo was present at all of these acquisitions. She was enraptured by the paintings that interested me. She was a close friend,” Dmitry Rybolovlev later told the court.

Nowadays, Bouvier plays down his relationship with Rybolovlev. “I didn’t spend much time with him,” he says. “I first met him in 2002 and started seeing him more regularly in 2008. He’s a man who decides everything on his own, who thinks his wealth makes him superior to other people. He thinks he’s more intelligent than others. According to his worldview, everything must bow to his will. He’s also someone who calculates everything to the minute. The only time I spent two nights at his home, in Kauai in 2012, I was handed a schedule with my departure time, lunchtime and bedtime. If he feels like having lunch earlier or eating fish, you have to eat fish.”

He goes on to deny that they were ever friends. “I never spoke to him directly. He doesn’t speak any French and very little English. He doesn’t want to speak a language where he feels inferior. I skied [with him] once in Gstaad, and the two of us were on a chairlift together, without any bodyguards because there wasn’t enough room. We tried talking about football.”

The Genevan is an excellent skier and when asked about Dmitry Rybolovlev’s downhill abilities, cannot help making a quip. “Does he ski well? He can hold his own. With two ski instructors and two bodyguards. And when he goes heliskiing, he has two helicopters. One of them is waiting at the bottom so he doesn’t waste any time.”

433 million francs’ worth of painting in one year

Their relationship may have been rocky, but the sales kept on coming before really taking off in 2008. In the year the global financial crisis struck, Dmitry Rybolovlev acquired paintings worth 433 million francs through Yves Bouvier, who in the process pocketed a margin of nearly 195 million francs, according to the reconstruction of events carried out by the audit firm KPMG as part of the legal proceedings brought by the Russian’s lawyers.

So what lay behind this 2008 purchasing frenzy? The answer can be found in a document dated 22 December that year: Elena Rybolovleva’s petition for divorce. The first cracks in the couple’s marriage had appeared several years previously. Dmitry had asked his wife to sign a contract agreeing on a separation of property in April 2005. Surprised, Elena asked her friend Tania Rappo for advice and ultimately refused to sign the agreement. Not that this mattered a great deal because, a few weeks later, Dmitry sets up two trusts in Cyprus named Aries and Virgo. They were officially registered in his children’s names, but secretly he kept control of them.

As the Rybolovlevs’ relationship deteriorated, Yves Bouvier and Tania Rappo grew closer — and their profits were about to boom.