A lost masterpiece’s return exposes scandal at a top Chinese museum

(By Caixin journalists Gao Yu, Xiao Hui, Wang Shuo and Ling Huawei)

At her home in Suzhou on 21 December 2025, 72-year-old Pang Shuling recalled the moment half a year earlier when the “Jiangnan Chun” scroll resurfaced. Her hands and heart, she said, still trembled.

On 22 May, a friend had called to tell her that a scroll attributed to the Ming dynasty master Qiu Ying, then listed in China Guardian Auctions’ spring preview catalogue, was a piece from the Xuzhai collection, once belonging to her great grandfather.

“The seals of Pang Laichen’s cherished collection… 12 of them. That’s it. My great-grandfather’s 12 Xuzhai seals, the original sandalwood box. It’s my family’s property. I saw it when I was a child. It felt so familiar,” she said.

Pang had not seen the handscroll since 1959, when her father, Pang Zenghe, donated it to the Nanjing Museum on behalf of the family. A decade ago, in a courtroom during a libel lawsuit against the museum, she was stunned to learn that the painting, once treasured by her family for generations, had somehow ended up in the hands of Lu Ting, chairman of Yilanzhai Art Co. Ltd., in the 1990s.

Now, staring at her computer screen, she found the scroll prominently featured in the auction catalogue, and she carefully counted the 12 seals of her great-grandfather, the renowned industrialist and collector Pang Yuanji, who also went by the courtesy name Pang Laichen. “A treasured item my father donated to the Nanjing Museum for free was disposed of by the museum under the pretext that it was a forgery. I never expected it to enter the auction market with an estimate of 88 million RMB (US$12.1 million),” Pang said. “I was shocked that this piece would reappear in such a dramatic fashion. I feel it’s my great-grandfather’s spirit in heaven protecting our family.”

On 23 December, the National Cultural Heritage Administration announced the formation of a working group to investigate the matter. The Jiangsu provincial government immediately followed suit, creating its own task force of officials from discipline inspection, law enforcement and cultural departments to conduct a full inquiry.

The scroll’s unexpected return from a 66-year odyssey through the murky depths of China’s state-run cultural apparatus has ignited a firestorm, raising explosive questions about how national treasures are managed, appraised and disposed of. This single painting’s journey — from a celebrated private collection to a premier state museum, then declared worthless and sold for a pittance, only to re-emerge as a multimillion-dollar masterpiece — has exposed a potential rot at the heart of one of China’s most prestigious institutions.

It has also triggered a high-level investigation by the country’s top cultural heritage authority and provincial government, threatening to become one of the biggest scandals to rock China’s art world in decades.

The story begins with Pang Yuanji, born in 1864 in East China’s Zhejiang province. A titan of industry with interests in silk, textiles and finance, He was one of modern China’s most important art collectors. His Xuzhai collection was legendary, putting him on par with Zhang Boju, another of the era’s great connoisseurs.

“During the War of Resistance Against Japanese Aggression, my great-grandfather expended immense effort to protect the Xuzhai collection,” Pang told Caixin. When her great-grandfather died in March 1949, his collection was divided among his heirs. Her father inherited one-third of the ancient paintings and calligraphy.

After the Communist Party won the Chinese Civil War in 1949, the family chose to remain on the Chinese mainland, and officials soon came calling to acquire pieces from the famed collection. In 1959, after repeated visits from officials of the Nanjing Museum, Pang and his family donated 137 pieces and sets of artworks, including the “Jiangnan Chun”.

Pang vividly remembers the visits by Zeng Zhaoyu, the museum’s director and a respected archaeologist. Zeng, a great-grandniece of the powerful Qing dynasty official Zeng Guofan, promised the family the ancient paintings would be preserved. At a time of national hardship, Zeng would bring peanuts for the children. That personal touch, combined with the political climate and promises of educational opportunities for the Pang children, sealed the decision.

“Jiangnan Chun”, a nearly 23-foot-long handscroll, was a crown jewel. Revered as one of Qiu Ying’s best works, it bore inscriptions from ten other Ming masters. In a 1953 letter, Zheng Zhenduo, then head of the national cultural heritage bureau, had specifically named it as one of six paintings that were “absolutely essential” to acquire for the state. The family’s donation was a profound act of civic trust.

But the relationship with the museum soured. In the 1980s, the family sued the museum for the return of two other scrolls they claimed were borrowed but never returned. The courts ruled the paintings belonged to the museum, but ordered a payment of 54,998 RMB to the family. Contact between them ceased for decades.

Then came the 2014 exhibition at the museum to commemorate Pang Yuanji’s 150th birthday. In the exhibition catalogue, a curator wrote, “Pang Laichen never would have imagined that his descendants would fall to the point of selling paintings to survive.” Pang Shuling sued for libel and won. But during the trial, to prove the family had sold art, the museum’s side presented a 2010 news report stating that “Jiangnan Chun” had been acquired by Yilanzhai. This was the first time she learned the treasured donation was no longer in the museum’s hands. For eight years, she wrote letters demanding an explanation, but received only silence.

After the scroll was pulled from the May auction following Pang’s complaint to Beijing authorities, the Nanjing Museum broke its silence.

On 17 December, it issued a statement: the painting, along with four others from the Pang donation, had been deemed a “forgery” by an expert panel in 1961, re-confirmed as “fake” by another panel in 1964, and was disposed of in the 1990s in accordance with regulations.

The museum provided records. The 1961 appraisal was conducted by a team led by the eminent connoisseur Zhang Heng. Their assessment noted that while an introductory inscription by Chen Liu was authentic, the rest of the scroll was a well-executed fake.

However, an analysis of the appraisal process from that era casts doubt on its thoroughness. According to a work report written by Zhang himself, the team examined over 51,000 items in 70 days. This breakneck pace meant each piece received, on average, about 20 seconds of scrutiny. Zhang admitted in his report that “this appraisal method is not a standard appraisal method, but a last resort adopted during a special time”.

Pang questioned the validity of these appraisals, demanding to see original signed documents, not just records of opinions. Furthermore, she and other art experts point out that the admission of an authentic Ming-dynasty inscription by Chen means the scroll is, at minimum, a genuine Ming-era artifact, not a worthless fake. “Is a genuine Ming dynasty artifact not a cultural relic?” she asked.

An art market professional who viewed the scroll at the Guardian auction preview told Caixin, “It is indeed a high-quality piece with great cultural value.”

For many in the museum world, the bigger question is not the scroll’s authenticity, but how a major state museum could sell off part of its collection. According to multiple museum professionals interviewed by Caixin, deaccessioning items from a state collection, especially 1,259 pieces at once as Nanjing Museum did, is extremely rare.

Under the 1986 Measures for the Management of Museum Collections, selling items is strictly prohibited. Items deemed unworthy of the collection are typically placed in separate storage for reference or transferred to other, less-endowed museums under strict government supervision.

“For a museum’s collection to flow back into the hands of an individual, this is almost unheard of,” said a former director of a major provincial museum. “This entire batch disposal needs to be thoroughly investigated. It could be a case of collusion between insiders and outsiders, and may involve the outflow of many precious relics, not just ‘Jiangnan Chun’.”

The museum’s paper trail details a seemingly bureaucratic process. A 1997 report requested that the 1,259 “deaccessioned items” be transferred to the Jiangsu Provincial Cultural Relics General Store for disposal. The request was approved by the provincial culture department. The museum then presented a sales invoice from the store, dated 16 April 2001, showing an “imitation Qiu Ying landscape scroll” was sold to a “customer” for 6,800 RMB.

The identity of this “customer” remains undisclosed by the museum. However, the late collector Lu Ting, who died just as the scroll was appearing at auction in May, had for years claimed ownership. His story, and that of his wife, Ding Weiwen, directly contradicts the museum’s timeline. They had repeatedly stated, including in a master’s thesis written by Ding in 2009, that Yilanzhai acquired the scroll in the 1990s from a descendant of Pang for 170,000 RMB.

Another collector, Yan Ming, told The Paper, an online state-affiliated news publication, that he saw the scroll at Lu’s home in 1999. But he heard a different story: Lu had bought it from the Jiangsu Provincial Cultural Relics General Store for 160,000 RMB, just one day after a batch of items had been transferred from the museum. Yan believes it was likely a “dingxiang” transaction, arranged specifically for Lu.

Scrutiny has fallen on Xu Huping, the man who helmed the Nanjing Museum for over a decade. The 1997 disposal report bears his signature as the museum’s then deputy director and legal representative. Xu, the son of a high-ranking revolutionary veteran, was a powerful and controversial figure in Jiangsu’s cultural circles. He has denied involvement, telling one media outlet, “This matter did not pass through my hands.”

However, his pivotal roles at the time make such a claim difficult to sustain.

Caixin’s review of business records reveals a startling overlap of authority. The Jiangsu Provincial Cultural Relics General Store, the entity that sold the scroll, was not only located at the same address as the Nanjing Museum — 321 Zhongshan East Road in Nanjing — but Xu served as the legal representative for both institutions simultaneously. He was also the founding president of the Jiangsu Collectors Association, where Lu served as an adviser. He effectively controlled the institution holding the artifacts, the state-owned store legally permitted to sell them, and the private association of buyers.

“This kind of arrangement, where one person heads the public museum, the commercial store and the collectors’ association, is extremely rare, if not unique, in China’s museum world,” said the former provincial museum director. “It creates a fatal loophole for corruption, allowing a museum director to use his appraisal authority to declare a genuine artifact a fake and his transaction authority to sell it at a low price to a specific person.”

Some experts speculate the 6,800 RMB invoice for an “imitation Qiu Ying landscape scroll” may have been for a different item altogether, a cover for the real transaction involving the more specifically named “Jiangnan Chun”. A retired museum employee suggested it could have been a sham transaction, with a much larger, off-the-books cash payment. “The invoice is for show,” he said. “The actual price was much higher. Lu himself said it was 170,000, and I think it was more than that.”

Lu had dreamed of building a massive private museum in Nanjing, the Yilanzhai Art Museum, but it ultimately failed and drained his finances, Caixin has learned from sources with knowledge of the matter.

He then was forced to mortgage “Jiangnan Chun” and seven other artworks to a local state-owned cultural firm, Nanjing Shizhuzhai Art Group Co. Ltd., for a loan of several tens of millions of RMB. When he defaulted, Shizhuzhai took possession of the collateral and sold the entire lot to Zhu Guang, a collector from Ningbo. It was Zhu who then consigned the scroll to China Guardian Auctions, bringing its long, hidden journey into the light.

In August, Pang filed a new lawsuit against the Nanjing Museum, demanding the return of all five paintings from her family’s donation that were deaccessioned. The museum argues that with the donation, ownership was legally transferred to the state, and the family has no right to reclaim the items. The case brings to the fore the ambiguities in China’s laws regarding cultural donations.

Legal experts note that while the Civil Code generally transfers ownership upon delivery of a gift, public donations are more complex.

The Public Welfare Donation Law requires recipients to use donations according to the donor’s intent. By declaring the items forgeries and selling them, the museum arguably violated the core purpose of the donation: permanent preservation for public benefit.

Jiang Yin, a history professor at South China Normal University, argues that the museum had an ethical, if not legal, duty to inform the donors and offer to return the items once it decided they were not collection-grade. “To sell it for 6,800 RMB in 2001 was an insult to the donor,” he said.

The scandal has sent a chill through the world of private collecting and philanthropy. “The museum’s attitude has broken the hearts of donors,” an official with a private museum association told Caixin. “It shakes the public’s trust in our national museums. And it’s incomprehensible and inexcusable.”

This article was first published by Caixin Global as “In Depth: A Lost Masterpiece’s Return Exposes Scandal at a Top Chinese Museum”. Caixin Global is one of the most respected sources for macroeconomic, financial and business news and information about China.

Related: From deliveryman to tofu maker: The everyday poets of China | The qipao & the gavel: A conversation with Christie’s Liang-lin Chen