FACT Inc. (OTC: FCTI) is a global leader of fine art and collectibles authentication technology that focuses on providing innovative solutions to address the challenges faced in the collectibles industry. The company’s proprietary forensic technology and management platform enable all parties, from collectors to insurers, to manage collections worldwide by leveraging advanced forensic technology, analytical tools and blockchain structure to protect assets.
In addition, FACT Inc. will be offering its clients the ability to create Non-Fungible Tokens (NFTs) on both their physical and digital fine art assets. It is the only company that can provide a secure link from the digital asset to the physical assets on a seamless platform. FACT Inc. is currently onboarding a system to allow its user to create, sell and trade their NFTs.
FACT Inc. was founded in 2020 as a collaboration by a team with art, business and forensics backgrounds. FACT Inc. is led by Patricia Trompeter, its CEO. The company is headquartered in Toronto, Canada, but operates all over the world.
The F.A.C.T. Solution
FACT’s solution for the collectibles industry is Forensic Asset Certification Technology (F.A.C.T.). The F.A.C.T. Secured Database standardizes collection management through centralized storage of F.A.C.T. scans, condition reports and provenance documentation throughout the life of the work.
The patent-pending software and methodology provide solutions that leverage advances in forensic technology to capture an asset’s surface profiles for authenticity verification in a matter of minutes. The F.A.C.T. secured device is the only portable solution of its kind that utilizes “digital fingerprints” from the physical asset for verification and condition reporting.
- Information Management –The F.A.C.T. System provides users with a secure interface that offers unique data entry, scanning specifications and asset information before it is securely stored on the blockchain.
- Visualization – The company’s device can be deployed quickly offsite, allowing for scans to be captured anywhere. These scans are instantaneously transmitted to the F.A.C.T. Secured Database. The scan is then reviewed by F.A.C.T. analytics software. The verification certificates and condition reports are auto-generated and added to the secure reporting.
- Confirmation – Multiple scans of the asset are captured by the F.A.C.T. Secured Device. These scans serve as unique “digital fingerprints” for the asset for verification purposes. To establish authenticity, scans are compared to the originals that are on record for the asset.
- Non-Fungible Tokens – FACT’s service offerings will include the creation of the token, smart contract integration, and dozens of optional terms and conditions. Each NFT is customized to the client’s specifications featuring any number of complex mechanics, such as usage analytics, royalties and value enhancements.
F.A.C.T. Interferometer Scanning
The F.A.C.T. Secured Device (patent pending) is powered by a proprietary white-light interferometer that captures ultra-high-resolution scans for comparative analysis that verify the authenticity and assess degradation at the lowest levels possible. The “digital fingerprints” are transferred and stored in the F.A.C.T. database.
Each scan with the Secured Device captures the area at a resolution of two microns or better, which is equivalent to a 50th of the diameter of a human hair. The scan can detect and document even the most minute details and characteristics of an asset. “Smart Pixel” Technology offers a 3D image with real-time communication to the master controller. It creates topographic and tomographic renderings while providing up to 100x magnification for viewing the 3D images. The F.A.C.T. Analytic Tools allow for efficient measurement of roughness, layer thickness, wear, volume, patterns and defects of each scan for verification.
The F.A.C.T. solution addresses needs in a number of market sectors, including:
- Valuable Assets Insurance – The company’s platform provides records of provenance, verification and condition reports protecting against fraud and simplifying due-diligence. Title insurance for a piece runs between 1% and 7% of the total value of the asset. Insurance companies justify this by claiming that rightful owners are difficult to track down, especially if there are gaps within ownership history records.
- Valuable Assets Secured Lending – Last year, approximately $24 billion in outstanding loans were secured by art. Borrowers face high-interest rates on these loans due to incomplete authenticity, condition and provenance records.
- Valuable Asset Transportation Companies – Over 14,000 paintings and prints were transported across international borders in 2019. Accidental damage during transport accounts for 50% of insurance claims. F.A.C.T. provides security and assistance with on-the-go reporting.
- Valuable Assets Business – Auction houses, museums and dealers can benefit from access to thorough, up-to-date information regarding the condition and provenance of assets.
- Non-Fungible Tokens – NFTs can be created to represent the entire asset or sections of the asset which can be offered as a standalone item or through fractional ownership. This versatility is expected to unlock new opportunities to expand the art and collectibles market and enhance value for collectors.
Collectibles and Asset Market
The collectibles market is a multi-billion-dollar industry that is vulnerable to fraud, theft and forgery. The overall art market was valued at $64 billion in 2019, and the numismatic market was valued at $4.1 billion in 2019.
Statistics show that:
- Approximately 50,000 pieces of art are stolen each year
- $2 billion is paid for art on the black market annually
- Per Interpol, 10% of the market is subject to fraud
- The FBI estimates that 80% of all art crimes are fraud, forgeries and fakes (not theft)
- The FBI also estimates that 50% of sports memorabilia on the market is fraudulent
- Art crime is the third highest-grossing type of crime
With its unique blend of innovative forensic technology, advanced data analytics and collection management, FACT is primed to capitalize on this market opportunity and provide a wealth of solutions to art collectors worldwide.
The company is also strategically positioned to capitalize on the recent growth in interest relating to NFTs. According to data from Statista, global transactions involving NFTs in 2020 were valued at $338.04 million, marking an increase of 138% over the previous year. In March 2021, Twitter CEO Jack Dorsey’s first tweet sold for roughly $2.9 million as an NFT, further highlighting the continued growth of the space.
Patricia Trompeter is the newly appointed CEO of FACT Inc. She has spent over 15 years in the financial services industry working with GE Capital. During her tenure with GE Capital, she held several positions, including CFO, operations leader, controller and M&A coordinator. Ms. Trompeter took a short break to focus on her philanthropic opportunities and family and afterward founded Webbs Hill Partners and Ceres Capital Holdings. She holds a B.S. in Finance and Economics and Management Information Systems from Marquette University.
Michael Arbach is the company’s CIO. He has over 17 years of experience working with business-oriented software and a track record of building high-performance solutions for top-tier companies. Code written by Mr. Arbach has processed millions of dollars in securities transactions. Today, some of the biggest banks and organizations rely on his software. Mr. Arbach is also an early blockchain developer and investor. He holds degrees in Applied Mathematics and Computer Science and is fluent in four languages.
- FACT Inc. combines advanced forensic technology, analytical tools and blockchain structure in a proprietary software and device solution for collectors worldwide.
- F.A.C.T. Software and Methodology are currently patent-pending products.
- The company leverages advances in forensic technology to capture surface profiles of an asset for authenticity verification in minutes.
- Scanning of the image is done down to two microns, which acts as a “digital fingerprint” showing details as minute as a 50th of the diameter of a human hair.
- All information on the pieces is kept in a secured database that standardizes collection management through scans, condition reports and provenance documentation.
- In March 2021, FACT announced its plans to integrate Non-Fungible Tokens (NFTs) within its blockchain technology platform.
- The art market was valued at $64 billion in 2019, with an estimated 50,000 pieces stolen per year.