News:

March 14 (Bloomberg) -- The latest story of looted art involves the Stasi, not the Nazis, a painting of Hercules and an informant who befriended the owner in Berlin.

``Hercules and Achelous'' by the Dutch painter Cornelis Cornelisz. van Haarlem (1562-1638) goes to auction for as much as $2 million in New York on April 15. Confiscated by the Stasi, the former East Germany's secret police, it was recovered this year and may be the first artwork reclaimed from the once-feared security agency to be offered in the U.S., auction house Christie's International said.

``These cases rarely pop up because the potential claimants are even more ignorant about their rights pertaining to restitution than Holocaust claimants are,'' said Marc Masurovsky, a co-founder of Washington's Holocaust Art Restitution Project.

The painting shows Hercules fighting the river god Achelous, who is disguised as a bull. The Potschien family in Berlin owned it from about 1925 until the East German government took it in December 1985, according to the catalog for the sale. While Christie's won't name the current owner, the catalog indicates it is a descendant of the Potschien family.

The owner's parents were art dealers in the former German Democratic Republic and shared a Berlin apartment with their son, who ended up with the painting in 1976, according to Christie's. The son paid no inheritance tax as the Van Haarlem, measuring 96 inches across, was part of the interior of his home, Christie's said.

`Tax Evasion'

In 1984, a Stasi informant befriended the dealers' son. A year later, the son was accused of tax evasion. He was taken into police custody and the picture was confiscated, according to Christie's.

The government dropped the criminal proceedings in 1986, keeping the Dutch picture and other paintings in lieu of taxes. They were shipped to the storage facilities of the Berlin State Museums, the auctioneer said.

This tactic was common in East Germany, according to Monika Tatzkow, a Berlin-based restitution expert. The authorities routinely presented art owners with tax bills, telling them they would seize artworks if the owners couldn't pay, said Tatzkow, who co-wrote a handbook on restitution, ``Nazi Looted Art.''

The informant continued his friendship with the son, promising to help him recover the paintings through his government connections, if the son donated the art to him. Under pressure from the Stasi, the informant donated them instead to the Berlin State Museums, according to Christie's.

``Hercules and Achelous'' was declared government property and moved to the Bode-Museum in 1986. The Gemaeldegalerie held it from 1998 to 2006 before returning it to the Bode, where it stayed until this year, according to the Christie's catalog.

Court Ruling

In 1990, after the fall of the Berlin Wall, the dealers' son began legal proceedings to recover the picture. The Berlin Regional Court ruled in 1997 that the confiscation was unlawful, as was the donation to the informant, who concealed his identity from the son.

The court began to process the restitution claim in 2003 and approved it in November 2007. This year, the owner got back the painting, now valued at $1.5 million to $2 million by Christie's.

Stories of loss and recovery can add commercial value to artworks. Van Haarlem's auction record, set in 1997 by Sotheby's in London for ``The Purification of the Israelites at Mount Sinai,'' is 298,500 pounds ($606,600), according to sale-tracker Artnet AG.

``The restitution of the Van Haarlem picture is one of a number of cases involving Stasi confiscation during the German Democratic Republic period,'' said Monica Dugot, director of restitution for Christie's. ``We are honored to be offering such a magnificent picture for sale on behalf of the rightful owner.''

To contact the reporter on this story: Linda Sandler in New York at lsandler@bloomberg.net;