Wildenstein Clan Cleared of French Tax Fraud—For Now

The judge saw a 'clear attempt' to hide assets but deemed the evidence faulty.

Guy Wildenstein, charged with tax fraud, arrives for his trial at the courthouse in Paris on September 22, 2016. Photo Eric Feferbergh/AFP/Getty Images.
Guy Wildenstein, charged with tax fraud, arrives for his trial at the courthouse in Paris on September 22, 2016. Photo Eric Feferbergh/AFP/Getty Images.

French courts today cleared art dealing heir Guy Wildenstein on charges of tax fraud and money laundering. The same verdict was pronounced for the case’s seven other defendants that included family members and counselors.

The Franco-American dealer had been accused of hiding works of art and large swaths of the family estate worth hundreds of millions of euros in a maze of offshore trusts in order to avoid inheritance taxes when family patriarch Daniel Wildenstein died in 2001. The monthlong trial was held last October.

Before announcing his decision, the judge spent almost an entire hour presenting his analysis of the case. He then said there wasn’t enough evidence to definitively say that Wildenstein intentionally committed tax fraud following the death of his father.

Despite the acquittal, presiding judge Oliver Géron said the Wildensteins’ financial arrangements, especially the infamous trusts, showed a “will to dissimulate,” and a “clear attempt to avoid” paying taxes. Géron implied he was not clearing Wildenstein of wrongdoing and said that his decision could be “misunderstood.” Ultimately the acquittal was granted on technical grounds of weaknesses in the investigation and faults in French tax fraud legislation.

The French law that requires the declaration of assets such as those in question in the Wildenstein trial was only instituted in 2011, 10 years after the Wildenstein patriarch’s death. The judge invoked the decision that the law was not retroactive and could not be applied to inheritance resulting from Daniel Wildenstein’s death, or assets transferred at the death of Guy’s brother Alec Wildenstein in 2008.

The prosecutor had previously described the case as “one of the longest and most sophisticated frauds of the Fifth Republic,” and had originally asked for a severe punishment of four years in prison, two of which would be actual hard time, as well as a fine of 250 million euros, or $265 million.

Neither Guy Wildenstein nor his nephew Alec Jr., also named in the case, were present for the verdict. However, Hervé Temime, Guy’s lawyer, told the press as he left the hearing that his client was “very relieved.”

“I think it was a mistake to make this a criminal case,” Temime said. “It should have been a purely fiscal civil trial.”

“When Daniel Wildenstein died there were no laws and no certainty about whether the assets in the trusts should be taxed,” Temime added. “The court explained that criminal justice cannot replace lawmakers.”

This case is but one hurdle Wildenstein has to clear in French courts. He still faces another civil lawsuit in which French authorities claim about 500 million euros in taxes. He also will have to explain how he came into possession of paintings seized by police at the Institut Wildenstein in Paris. Those works are believed to have been stolen from their legal owners.


Follow Artnet News on Facebook:


Want to stay ahead of the art world? Subscribe to our newsletter to get the breaking news, eye-opening interviews, and incisive critical takes that drive the conversation forward.

Share

artnet and our partners use cookies to provide features on our sites and applications to improve your online experience, including for analysis of site usage, traffic measurement, and for advertising and content management. See our Privacy Policy for more information about cookies. By continuing to use our sites and applications, you agree to our use of cookies.

Subscribe or log in to read the rest of this content.

You are currently logged into this Artnet News Pro account on another device. Please log off from any other devices, and then reload this page continue. To find out if you are eligible for an Artnet News Pro group subscription, please contact [email protected]. Standard subscriptions can be purchased on the subscription page.

Log In