Lenin’s Willing Industrialist: The Saga of Armand Hammer, Part 3: The Faberge Fraud and Other Sleaze

Part 1
Part 2

One day while Armand Hammer was browbeating his PR man Carl Blumay by rattling off his list of accomplishments, he mentioned that in addition to being a “great industrialist” (Blumay 362) he was also a “distinguished philanthropist and art collector” (Ibid.). He capped his speech by claiming that he may, in fact end up living forever.

Art was very important to Armand Hammer, or rather being perceived as someone who was a knowledgeable collector of great art was important to the public image he was intent on constructing.

In his autobiography Hammer explains that his goal was to amass an eclectic collection of the world’s greatest artworks to share with the public who otherwise wouldn’t get to enjoy fine art. In an interview with Charlie Rose he declared that “Great works of art should not be held in the private and exclusive property of rich men. They should be shared with and enjoyed by everybody, for the education of the young and the enrichment of the lives of all humans” (Hammer 260). That his philanthropy was really an enterprise linked to everything from tax fraud to forgery should come as no surprise to those familiar with the wide chasm between Hammer the PR creation and the real Armand Hammer. He told Carl Blumay, his trusted employee of more than a quarter-century, the following when talking about what he was going to do with a particular batch of paintings: “I’m not going to sell them. … If I donate them to a museum or a school, the tax law enables me to base my deduction on the appreciated value, not on the purchase price. The more I inflate their value, the more I’ll be able to write off” (Blumay 22). Blumay’s recollection is corroborated by a Washington Post review headlined “An Exhibition of Losers by Major Masters,” by Paul Richards, who “speculated that the entire [exhibition] was an attempt by Hammer to inflate the value of the collection so that he could claim a fat tax deduction” (Blumay 173).

Not only did Hammer inflate the value of artworks to pocket the difference, but he used shareholder money from his Occidental Petroleum enterprise to acquire artworks without the knowledge of unwitting investors. For example, he claimed to have purchased some sketches by the master Leonardo da Vinci with his own money, “as he had repeatedly trumpeted to the media for more than eight years” (Blumay 447). The truth was that the purchase had been authorized by “an unpublicized special appropriations fund” (Ibid.) by Oxy’s board of directors. How it worked was that an “executive committee asked to make a secret ‘appropriation’ to the Armand Hammer Foundation of up to $6 million dollars to purchase the Leonardo” (Epstein 300). One of the committee members, businessman Zoltan Merszei, claimed that the “committee had no choice but to approve if they wanted to remain in Hammer’s good graces” (Ibid.).

Hammer was, in essence, strong-arming employees in a private agreement to use stockholder funds to purchase artworks in his name (or the name of his foundation) in order to build a reputation as a patron of the arts, while also claiming tax deductions on the works and inflating the prices when he could get away with it. The Da Vinci piece in question, “called the Leicester Codex because it had been owned by the Earls of Leicester, consisted of 18 sheets” (Epstein 300) featuring Da Vinci’s handwritten notes on subjects ranging from “astrology” (Ibid.) to “hydraulic engineering” and the “color of the sky.” The sheets were meant to be viewed in toto, but Hammer separated the notebook from its original form into a loose-leaf configuration. Time’s art critic Robert Hughes “criticized Armand Hammer for decreasing the value of [what Hammer presumed to rename] the Codex Hammer by hustling it around the world for publicity purposes” (Blumay 461). Hammer attempted to have Hughes fired from his job at Time for his temerity, but the critic held his ground, and retorted that what Hammer had done to Da Vinci’s work was “obscene… a monument, in short, to the vanity of vanities” (Ibid.).

The Leicester Codex was not surprisingly dubbed “The Coded Hammer” when in the Doctor’s stewardship. It was eventually put on the market again and purchased at auction for a cool thirty-two million dollars by none other than Bill Gates. The founder of Microsoft thankfully returned the Codex to its proper form and changed the name back to the original title.

Not every artwork acquired by Armand Hammer would be so fortunate however, and Hammer’s mercurial temper could mean that even when he gave someone artwork as a gift, he might retract the present if he felt slighted. When he was planning to make the rounds on a series of talk shows in order to carry water for the Soviets during a time when “Newspapers across the United States” (Blumay 318) were printing a series of condemnatory articles about Hammer’s adopted home of Russia, Armand “called [the University of Southern California] and received permission to borrow Rubens’ Venus Wounded by a Thorn and two other paintings he had donated in 1965” (Ibid.). After lavishing “obligatory praise onto Lenin” (Blumay 319), “mouthing Leninist theory” (Ibid.) and demonstrating a “refusal to acknowledge Stalin’s butchery.” Hammer finished his appearance on the show and returned to his office, where he ordered his personal aide (and alleged mistress) Martha Kaufman “to hang Rubens’ Venus Wounded by a Thorn” (Blumay 319). “USC should have given me an honorary degree fourteen years ago, and they didn’t,” he said by way of explanation. “They screwed me. Now it’s my turn to screw them! They’ll never get that painting away from me” (319). This was not just chutzpah. It was theft.

And it was the least of Doctor Armand Hammer’s shady doings in the art world.


It was Hammer’s supposed good fortune that when searching for office space in Moscow, he chose Kuznetski Most 4. According to Hammer, “the building had previously belonged to the former Court Jeweler, Carl Faberge, in whose work I was to become intensely interested” (Hammer 127). Armand Hammer used a “set of the signature stamps of the Faberge workshops, so he could doctor unsigned items in the back room” (Epstein 138) and then sell them as authentic Fabergé’s. Such actions constitute serious malpractice since any expert in jewelry worth their salt will tell you that settings are as important to evaluation and authenticating as considering the precious metals or stones in question. Who owned or made something (or who didn’t) can enhance or depreciate the value of an item drastically. And as Hammer “was thus able to expand vastly the supply of Faberge” (Ibid.) works, he in turn devalued the existing and non-forged Czarist articles.

Edward Epstein contends that “the Soviets provided [Hammer] with a set of Faberge signature stamps so that he could ‘sign’ reproductions” (Epstein 291). The money that he acquired from the forgeries was part of the fun, but Hammer’s true pleasure appeared to be in deceiving everyone from art historians to the general public. He seemed to take a perverse glee in fooling people with his counterfeits. Here is Edward Epstein on Armand Hammer describing his process to a female friend:

His face beaming with pride, he demonstrated to Bettye how the nineteenth-century tools provided the appearance of an authentic Faberge signature. He told her how collectors who fancied themselves experts on Faberge were duped by the forgeries. He would let them discover the ‘signature’ on their own and then, if they told him about it, act surprised. Hammer thus enjoyed not merely the monetary profit from the sale but a sense of superiority in outwitting the art buyer. To him, collecting was a confidence game in which he supplied the necessary authentication, which took the form of a label, genuine or fake. Hammer treated forgeries as a sort of private joke. In his home in Los Angeles, he hung imitations of the paintings he had acquired. (Epstein 291)

It is likely also that revenge and domination for perceived slights against Jews by Russians sweetened the pot for Armand Hammer (even though his brother is emphatic in his assertions that the Hammer family was treated well by the Czar). Just as contemporary accounts from Weimar Germany in the hyperinflation years are filled with schadenfreude-rich tales of barons and landed gentry degrading themselves (performing in Tingeltangel theaters or otherwise abasing themselves), Hammer seemed to derive sadistic glee from hiring “a penniless white Russian prince named Mikhail Gounduroff to act as a shill. Gounduroff lent ‘his princely tone to our business’” (Epstein 138).

When Armand Hammer took his confidence game stateside, he found the rubes willing to buy slipshod merchandise marketed as priceless royal heirlooms. Like all great confidence men Armand understood that his fabrications would come with fewer or no consequences if “through the fabrication you tell your audience what it wants to hear. In this case, Americans wanted to hear that they could buy authentic pieces of the Russian Imperial treasure at bargain basement prices” (Epstein 138).

Armand Hammer’s “circus…based on illusion” (Epstein 137) was buttressed by a book (his first autobiography) ghostwritten by fellow traveler and useful idiot, the New York Times’ own Walter Duranty (who, as mentioned in Part 1 won a Pulitzer for covering up the Holodomor). The Quest of the Romanoff Treasure helped sell the lie, with its embellishments and outright fabrications about how Hammer had stumbled upon a trove of supposed Czarist treasures. As for the “artworks” marketed in department stores across the country, art historian Robert Williams proclaimed that the curios consisted primarily of “tourist junk…the debris of Russian hotels [and] shops” (Epstein 138).

Hammer’s PR man Carl Blumay did his best to keep the keener critics off Hammer’s scent, but those in the know “blasted the ‘Romanoff treasures’ as ‘slipshod goods,’” (Blumay 104) and “described the department store sales as ‘con jobs designed to defraud naïve purchasers,’” (Ibid.) while also objecting “to Hammer’s mass-market sales approach. ‘He’s a honky-tonk peddler who had terrible taste then and has terrible taste now’” (Ibid.).

However, not every art transaction Armand Hammer made involved a forgery, inferior product, or something with an invented pedigree. Armand Hammer did sell some high-quality and authenticated artwork; but his motive was to “kick back money to the Stalin government” (Blumay 107) according to his loyal brother Victor, and he did it “during the days of the McCarthy hearings.” Armand Hammer was never caught smuggling artworks on behalf of the Soviets. His brother Victor could not say the same, however:

He said his brother had made him wear a floor-length overcoat with false pockets so that he could smuggle pornographic art objects and books into Egypt for King Farouk. In 1948 Victor repeated the stunt en route from Moscow and was charged with smuggling Soviet-owned paintings into the United States. It was also reported the proceeds from the sales had been returned to the Soviet Union. (Blumay 107)

Armand’s ultimate attitude toward artwork can probably best be summed up by an anecdote Carl Blumay tells about being in an art gallery with his employer, where the businessman and a small group were looking at Rest on the Flight into Egypt by Hans Rottenhammer and Paul Bril. The painting depicts “Mary tenderly holding the Christ child with Joseph by their side as they paused in the midst of their long journey” (Blumay 108). Hammer stared at the gorgeous Flemish painting and asked why Mary and Christ were fleeing to Egypt. A woman who was present at the gala had to explain to Armand Hammer that “King Herod had ordered all children two-years old and under to be killed and that God had instructed the Holy Family to flee… to save the life of the Christ child” (Blumay 108). In other words, Hammer “collected art he knew nothing about” (108). In his defense Hammer said that his great joy was in “‘Outbidding everyone at auction and getting a work away from someone who wants it badly’” (Ibid.), adding that his father Julius “was a stamp collector, and I was too. I collect art the way I collected stamps. Once you get a stamp and mount it in your album, you don’t spend your time looking at it” (108).

Those interested in the Jewish question could spend a lifetime searching for a more mercantile outlook toward the sublime: the Madonna and Christ Child to be viewed as stamps in a collection, resting in a catalogue filled with frauds and price-inflated tax write-offs, while worthwhile items stolen from royalty slaughtered or exiled in revolution was sold off to fund Joseph Stalin’s increasingly genocidal ambitions.

Go to Part 4.

Works Cited

Blumay, Carl. The Dark Side of Power: The Real Armand Hammer. Simon & Schuster, 1992

Epstein, Edward J. Dossier: The Secret History of Armand Hammer. Random House, 1996.

Hammer, Armand and Neil Lydon. Hammer: The Armand Hammer Story. Perigee Trade, 1988.

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