It is important to know that there are no federal bureaus or departments which regulate the sale of art. Instead, art sales are governed by the Uniform Commercial Code. This code is enacted in various states and it says that art work must have a clear title, the item must be what it is purported to be, and it says that the person selling the artwork has to have the legal right to transfer the title. The problem comes in when the work was stolen generations before and has changed owners many times through the years. The fact is, theft nullifies title. If a claim is made in less than four years (or fewer in some places) then the person who most recently purchased the piece does not have a legal right to the artwork. When the statue of limitations is up, it would seem that the person making the claim that the property is rightfully theirs would be out of luck. That is not the case. If the person making the claim did not know who to sue because they did not know where the property was, then they only have to file the claim within the appropriate period after the location of the piece was discovered.
For this reason, it is imperative that you GIVE YOUR APPRAISER EVERY AVAILABLE PIECE OF INFORMATION and that your appraiser conducts due diligence. In fact, in the contract your appraiser sends you there should be a sentence that reads something like, "It is your responsibility to provide me with factual information within your knowledge, as may be requested. This includes, but is not limited to, bills of sale, insurance records, auction catalogs, exhibition records, and previous appraisals of said property." In the case that your work is stolen, the court will try to balance the steps you took to ensure clean title versus the steps the original owner took to report the loss and make it known to law enforcement and the art world.
BEFORE YOU BUY A PIECE OF ART MAKE SURE YOU:
1. CHECK THE ART LOSS REGISTER
2. CONTACT THE FBI'S ART LOSS PROGRAM
3. IF THERE IS A catalogue raisonné OF THE ARTIST WORK CHECK IT!
4. READ PUBLICATIONS THAT SPECIALIZE IN THAT TYPE OF ART
5. CHECK GOVERNMENT WEBSITES IF THE ARTWORK ORIGINATED IN ANOTHER COUNTRY