updated 6/15/2004 11:19:55 PM ET 2004-06-16T03:19:55

The owner and manager of a lower Manhattan art gallery were accused Tuesday of selling $7 million in forged paintings that were intricately detailed and almost indistinguishable from the originals.

In at least one case, a phony painting and the original landed at competing auction houses for sale in the same month, federal prosecutors said in announcing the charges.

Ely Sakhai, identified in court papers as the owner of the Exclusive Art gallery, and Houshi Sandjaby, identified as its manager, were indicted on conspiracy charges. Sakhai also was charged with mail fraud and wire fraud.

There was no answer Tuesday evening at a telephone number listed for the gallery, and lawyers for both men were not immediately available to comment by telephone.

The men were to appear in Manhattan federal court later to enter pleas.

Prosecutors said the forgeries were primarily works from impressionist, post-impressionist and modern artists, including Marc Chagall, Pierre-Auguste Renoir and Paul Gauguin.

The pair bought authentic paintings, then hired artists to carefully copy them, down to markings on the backs and frames of the canvases, prosecutors said.

Special coatings were brushed onto some of the finished fakes and other changes were made to make the paintings look decades old, according to the indictment. The fraud took place primarily in the mid-1990s, prosecutors said.

In one case, a copy of Gauguin’s “Vase de Fleurs (Lilas)” was sold in 1997 to a buyer in Tokyo and later consigned to Christie’s auction house for a May 2000 auction, prosecutors said.

Sakhai kept the authentic painting and signed it over to Sotheby’s house for its auction the same month, according to court papers. An expert concluded that the Tokyo painting was a fake after the auction house learned of the duplication.

Prosecutors said they would press to have the two men forfeit $7.38 million, the amount they are alleged to have made from selling the phony paintings.

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