Story highlights Prosecutors allege a New York-based art dealer bilked buyers by selling them forged art

Spanish authorities arrested Jose Carlos Bergantiños Diaz, federal prosecutors say

Investigators allege that he and associates made more than $30 million off fake art

The painter behind the works was also indicted; Bergantiños met him on a street corner

Spanish art dealer Jose Carlos Bergantiños Diaz helped persuade wealthy buyers to shell out millions of dollars for works he claimed famous masters of modern art had painted.

But in reality, U.S. authorities allege, the works he sold as Rothkos and Pollocks were fakes painted by an artist he met on a Manhattan street corner.

The alleged scheme stretched for nearly two decades, involved several New York art galleries and earned the conspirators more than $30 million, according to an indictment unsealed in federal court on Monday.

Last week, authorities closed in on Bergantiños and his brother, arresting them in Spain, federal prosecutors said. The brothers, according to the indictment, face conspiracy and money laundering charges.

The painter, Pei Shen Qian, was also indicted. He's accused of making false statements to FBI agents, conspiracy to commit wire fraud and wire fraud. Investigators believe he fled to China as the alleged scheme started to unravel.

The indictment is the latest chapter in a case that's rattled the modern art world, involving several galleries and wealthy buyers. Galleries made more than $80 million off of dozens of fake works, the indictment alleges. And Bergantiños and his associates made more than $33 million.

"Today's charges paint a picture of perpetual lies and greed. As alleged, the defendants tricked victims into paying more than $33 million for worthless paintings which they fabricated in the names of world-famous artists," U.S. Attorney Preet Bharara said in a statement Monday. "The Bergantiños Diaz brothers then laundered and hid their illegal proceeds overseas. With today's Indictment, the defendants must now answer for their alleged roles as modern masters of forgery and deceit."

What started with a meeting between Bergantiños and Qian on a New York street corner evolved into an elaborate plot, the indictment alleges.

Qian would paint works in his home in Queens, New York. Then Bergantiños and his associates would peddle them through galleries to unsuspecting buyers who paid millions, the indictment says.

The alleged forged works purported to be paintings by famous artists, including Mark Rothko, Jackson Pollock, Willem de Kooning, Robert Motherwell and Clyfford Still, the indictment says.

But long before the works of art were sold, according to the indictment, Bergantiños played a role in the forgeries.

To make the paintings more convincing, Bergantiños bought old canvases at flea markets, stained newer canvases with tea bags to make them look older and gave Qian old paint to use.

Then, after the works were completed, according to the indictment, Bergantiños "subjected many fake works to various processes, such as heating them, cooling them, and exposing them to the elements outdoors, in an attempt to make the fake works seem older than they actually were."

In at least one instance, the indictment says, Bergantiños used a blow dryer to heat up a forged painting.

Authorities have said his girlfriend, Glafira Rosales, was a key player in the alleged conspiracy. After pleading guilty last year to charges of conspiracy, wire fraud, money laundering and filing false federal income tax returns, she's awaiting sentencing in federal court.

Glafira Rosales leaves Manhattan Federal Court after pleading guilty in 2013 to selling over 60 works of fake art.

In an interview with Bloomberg in Shanghai last year, Qian admitted imitating modern masters' works, but said he never intended to pass them off for profit. In court documents, prosecutors allege he received between several hundred and several thousand dollars for paintings the art dealers and galleries sold for millions.

"I made a knife to cut fruit," he said, according to Bloomberg. "But if others use it to kill, blaming me is unfair."

If the lawsuits filed against Bergantiños and his associates are any indication, there's already plenty of finger-pointing over the alleged forgeries.

A number of civil cases against him are still pending, according to federal court records.

It was not immediately clear whether Bergantiños had legal representation or whether Spanish authorities plan to extradite him to the United States.