The high-profile Portuguese art collector and businessman Joe Berardo, 76, has been detained by police over fraud and money laundering allegations. Berardo’s 900 strong art collection includes works by Pablo Picasso (1881-1973), Francis Bacon (1909-1992) and Nan Goldin.

In 2017 three Portuguese banks filed a joint lawsuit against the businessman in order to recover nearly €1 billion (£860 million) in debt, sparking a four-year-long criminal investigation. Berardo claimed that any loans he requested were not for him, rather for the companies he was associated with. This included the company Berardo Collection Association that owned and managed his art holdings.

Police are focussing their investigation on “an economic group”, including Berardo, that allegedly breached contracts with one of the banks, Caixa Geral de Depositos (CGD). Berardo is also accused of shifting valuable artworks into a trust to protect them from creditors.

On behalf of the three banks, the Portuguese government subsequently seized 75% of Berardo’s collection as collateral. But Prosecutors have also criticised CGD for its poor procedures which did not meet “good practices and may constitute the practice of crime“.

In 2006, Berardo agreed to loan his collection to the Centro Cultural de Belém, a major modern art museum in Lisbon. The section holding the businessman’s collection is known as the Museu Coleção Berardo. It is now one of the country’s most visited museums, showcasing renowned works by Willem de Kooning (1904-1997), Jackson Pollock (1912-1956), Joan Miró (1893-1983) and Piet Mondrian (1872-1944).

At the time of the mass seizure in 2019, doubts were cast over the fate of Berardo’s museum. The museum has since remained open, with the general manager Pedro Bernardes stating “I will not make any comment on an event that is not going to affect the museum visitors, our exhibitions, or the programme.

This week Portuguese police searched more than 50 private homes, banks, and offices for evidence. Berardo is currently in custody alongside his lawyer, although no charges have yet been brought against them.