The heir to the art-dealing fortune is accused of defrauding the French government out of more than $600 million
The trial of international art dealer Guy Wildenstein, who is accused of cheating the French government out of more than $600 million in taxes, began on Monday in Paris.
Wildenstein, 70, the heir of a New York-based art dealing empire, is on trial with his nephew, sister-in-law and their financial advisers. They are accused of engineering an elaborate tax fraud and money laundering scheme to conceal the money he inherited from his father, Daniel Wildenstein, who died in 2001. If convicted, Wildenstein faces major fines and a maximum of 10 years in prison.
French authorities allege in court documents that aside from smaller parts of the estate owned in France and London, the “whole patrimony of Daniel Wildenstein was held in trusts” in tax havens like the Bahamas, Guernsey, or the Cayman Islands, according to the Associated Press.
According to French authorities, while Daniel lay in a coma, Guy Wildenstein and his older brother, Alec, who died in 2008, allegedly transfered more than $250 million in family-held artwork from vaults in New York to Switzerland. They also allege the Wildensteins abruptly transferred the thoroughbred racing stables owned by Daniel into a newly-organized company owned by the family.
The case has drawn intense media attention in France and has become popularly known as the “Dallas on the Seine” because of the level of opulence in the allegations, as well as a convoluted backdrop involving divorces and feuds between heirs.
Among other assets in the family portfolio were the family’s New York townhouse, which is now subject of a disputed $90 million sale to the nation of Qatar; the Chateau de Marienthal, one of the largest private castles in the Paris region and a 6,000-acre Kenyan ranch.
Wildenstein has been free on $6 million bond since his indictment in 2013. His defense attorney is Herve Temime, who has previously represented Roman Polanski and Fran ois Marie Banier, who was convicted of defrauding L’Or al heiress Liliane Bettencourt.
Wildenstein told Paris Match in October that his father “never talked to me about his business affairs. He wouldn’t seek my advice to manage his fortune or dispose of his property while he was alive.”
Wildenstein added, “I I knew that he had trusts but I wasn’t ever informed of the details. I’m not an accountant or a financier. All these legal aspects involved him because this was not my forte and he knew it.”
Daniel Wildenstein was the third family member to head the art dealership, which was founded in Paris by his grandfather Nathan in the 1880s.
A shrewd businessman and art scholar, in 1940, Daniel moved the bulk of his family’s saleable artworks to galleries in New York, London, Buenos Aires, continuing to expand the family’s proprietary rights as the preeminent dealer in Old Masters and Impressionist art for the next half-century.
In the late 1990s, Vanity Fair described David Wildenstein as “the richest and most powerful art dealer on earth” whose estimated personal fortune at the time was $5 billion.
In all likelihood, the actual extent of the Wildenstein fortune would have remained a closely guarded secret if not for three people: Alec’s ex-wife, Jocelyne, the Swiss-born socialite whose NYC divorce filings exposed much of the family’s lavish lifestyle to public scrutiny; Daniel’s widow, Sylvia, who pursued her stepsons into court over alleged hidden assets; and Lyouba, Alec’s second wife and widow, who after cooperating with French authorities, now is a co-defendant in the current proceedings.
Whatever the result, the Paris courtroom won’t be the end to the Wildenstein saga. Documents filed into the French casework indicate the United States I.R.S. plans to go after alleged taxes and penalties related to more than $250 million in artworks moved out of the United States during those first few days when Daniel Wildenstein was in coma.