As a magic aficionado my bet is that the picture was rolled into the frame and a pre torn version popped out the bottom. Like the old dollar bill trick. Still impressive.
Then I realized there must have been a big ass slot in the bottom of the frame, something no art inspector would miss. If the auction house had known about it and then it really could have been done any number of ways.
It's hard to be absolutely certain given the limited photographic evidence, but I think in light of those concerns it's the most likely option.