The heir to the Wildenstein art-dealing empire appeared in court in Paris in September 2016 to respond to charges of tax fraud and money laundering. Prosecutors accused him of hiding paintings and properties in trusts and offshore holding companies and failing to report the full extent of the family’s wealth following the deaths of his father Daniel in 2001 and brother Alec in 2008.
With an estimated value of €1 billion (approximately £858 million), the Wildenstein family fortune includes Old Master paintings, racehorses, Caribbean properties and a Kenyan ranch that provided the backdrop to part of the film Out of Africa.
Although presiding Judge Olivier Geron said there had been a “clear attempt” at concealment, thanks to a loophole in French law Wildenstein’s actions were technically legal when he made the reports. At that time, French tax law on the declaration of inheritance assets in financial trusts was not clear. The loophole was eventually closed in 2011.
“When Daniel Wildenstein died there were no laws and no certainty about whether the assets in the trusts should be taxed… The court explained that criminal justice cannot replace lawmakers”, Guy’s lawyer Hervé Témime said.
As a consequence of the loophole, Guy avoided a €250 million fine (£218.89 million) and two years’ imprisonment. Seven others including his nephew and a Bahamian unit of Royal Bank of Canada were also cleared of tax fraud and complicity in fraud.
“The court is perfectly aware its verdict may run counter to public belief and be misunderstood”, Judge Geron conceded.