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A new law designed to protect the booming American Indian art market from fraud has deeply divided American Indian artists.

While most people believe the law requiring American Indian artists to prove their heritage is well-intentioned, some say it's unnecessary, it could ruin careers and it amounts to an ethnic purge.Others say it's the only way to ensure American Indian art is just that - art created by an American Indian.

"There's definitely a spectrum of opinion out there about the law," said Carla Roberts, executive director of Atlatl, a Phoenix-based group devoted to promoting contemporary American Indian artists.

Under the law, passed by Congress in 1990, artists who want to sell their work labeled as American Indian art must prove they are members of a federally or state-recognized Indian tribe.

Artists who aren't members of any recognized tribe, but claim American Indian heritage, can petition a tribe to designate them as an "artisan."

Penalties for selling counterfeit American Indian art were significantly boosted by the new law to $250,000 and five years in jail, from the previous $500 and six months in jail. A commercial gallery selling fraudulent work could face up to a $1 million fine.

The law actually builds on a law passed in 1935 to prevent fraud in the American Indian art market, whose value is estimated by government experts at $400 million to $800 million annually.

In recent years, the U.S. government began requiring Indian look-alike products imported from such places as the Philippines and Mexico to bear indelible country-of-origin marks.

But fraud - both from imported products and from those produced domestically - has continued to dog the market, siphoning off as much as $40 million to $80 million annually, a federal report estimated.

Meanwhile, there wasn't a single prosecution under the old law, said Geoff Stamm, assistant general manager of the Indian Arts and Crafts Board, a division of the U.S. Interior Department, which is responsible for enforcing the law.

With the increased penalties, "it's now worth a prosecutor's time," Stamm said.

Proving a criminal fraud case remains difficult. But the new law also provides for civil cases, which are easier to prove and can be brought by a prosecutor or a tribe.

"This is, in effect, a truth-in-advertising law," said Stamm. "It doesn't say you can't sell products with Indian designs. It merely says you can't say a product was made by an Indian or is an Indian product if it isn't."

Interestingly, the new law hasn't actually been enforced yet. The regulations needed to enforce it are still being written by the Indian Arts and Crafts Board, a tiny agency that wasn't given any additional funds by Congress to carry out the new law.

But some gallery owners, worried about the massive fines they could face for selling counterfeit works, already are asking American Indian artists for proof of their tribal membership.

The American Indian Contemporary Arts Gallery in San Francisco canceled an exhibit of works by sculptor Jimmy Durham after he refused to prove his Indian heritage.