A New York State judge warned dealer Leigh Morse that her days on the outside may be numbered. She’s paid only a fraction of her required $1.7 million restitution for defrauding clients of the now-defunct Salander-O’Reilly Galleries.
“This is not what I expected and it’s certainly not satisfactory,” said State Supreme Court Judge Michael Obus, who in July 2011 sentenced Morse to serve Saturday nights in jail for four months and repay victims. She’s paid just $60,000, or 3.5 percent, of the restitution, Kenn Kern, an assistant district attorney, said in the hearing in lower Manhattan. Without elaborating, Kern said that he’s “deeply troubled by credit card spending that at least raises a significant red flag for me.”
With her husband, Morse, 58, owns an apartment on Riverside Drive and a house in Mount Bethel, Pennsylvania. She hasn’t sold either.
Obus said he was told that the mortgage of the Pennsylvania home is greater than its market value, and Morse’s business, Leigh Morse Fine Arts, has struggled because her felony conviction hurt her reputation.
“That is not an excuse for not making restitution payments,” Obus said.
Morse also owns artwork that she put up as collateral for personal loans. Obus said he will schedule a “re-sentencing proceeding” in January and raised the possibility of incarceration.
Guilty of Scheming to Defraud
A jury in April 2011 found Morse guilty of scheming to defraud artist estates. At Morse’s sentencing, Judge Obus said the dealer betrayed the trust of clients by stonewalling them about artwork the gallery had secretly sold without their consent. Her clients included Robert De Niro, although Morse was acquitted of the charge of stealing from the actor. She exhausted her appeals in March 2014, and in April, Obus noted that she’s “certainly in arrears as far as restitution is concerned.” The restitution order required her to pay $346,500 a year until she reaches $1.7 million.
Morse’s former boss, Lawrence Salander, 65, is serving a six-to-18-year sentence at Midstate Correctional Facility, north of Utica, New York. According to the website of the State Deptartment of Corrections and Community Supervision, he has a parole hearing this coming March and the earliest he’s eligible for release is July 2016.
Morse declined to answer questions after today’s hearing. One of her lawyers, Clinton Calhoun, said she’s pursuing ways to raise money.