Dutch tax adviser arrested in Italy for extradition to U.S. on tax evasion charges

Dutch tax adviser Frank Butselaar was arrested at his holiday home in the Italian village of Valfabbrica on Tuesday evening to be extradited to the United States. The American authorities accuse Butselaar of organizing tax evasion for his famous and wealthy clients. The court in Perugia ruled on the tax adviser’s extradition on Tuesday, Financieele Dagblad reported.

Butselaar’s wife confirmed his arrest to FD. He will likely be transferred to a prison in New York later this summer.

Butselaar’s Dutch lawyer Annabel Vissers called the Italian court’s ruling disappointing. “It is regrettable that this is how it is. It is also remarkable that my client's arrest has now been ordered because of an alleged flight risk. He was under house arrest in his holiday home for three months and knew this was coming,” she told the newspaper.

Butselaar was arrested one day after arriving at his Italian holiday home in March based on an American arrest warrant. The Italian authorities placed him on house arrest while they handled the U.S. extradition request.

The tax adviser’s Italian lawyers argued during the hearing on Tuesday that the American authorities deliberately waited for Butselaar to arrive in Italy because the chance that the Netherlands would extradite him was smaller. On the day of his arrest in March, the international arrest warrant against him had been in effect for over five months. With an extradition request between the U.S. and Italy, the Dutchman has significantly fewer rights than between the U.S. and the Netherlands. For example, Butselaar would not be allowed to serve his sentence in the Netherlands, according to FD.

The American authorities accuse Butselaar of “developing sophisticated international tax evasion schemes for high net worth clients with worldwide income.” According to the prosecutor, he built tax structures in Cyprus for artists and models who went on to live in the U.S., thereby depriving the American tax authorities of years of taxes totaling over 100 million dollars.

Butselaar’s American lawyer told FD that it would take at least two years after his extradition before he would stand trial in New York. Until then, he will remain in custody.

Butselaar’s clients include DJs Tiesto and Afrojack, models, and actors, among others.

Also accused of tax avoidance schemes in Netherlands

Butselaar’s offices were raided by the Dutch financial crimes service FIOD in March 2018 on suspicion that he crossed legal boundaries with his tax avoidance schemes for many celebrities, including Dutch musicians. He was suspected of tax fraud and was due to be tried this year. “At the beginning, I was naive. You think it will be completed after a few months, but we will be at least five years further when the trial begins,” he told Quote.

In August 2018, Butselaar was successful as the defendant in a lawsuit filed by one of his former clients, Willem Rebergen, better known as DJ Headhunterz. Rebergen said he followed Butselaar’s tax avoidance advice, including the creation of several shell corporations abroad, including in Cyprus, to shift and move money.

When Rebergen’s conscience got the better of him, and he worked with the Belastingdienst to get his affairs in order, he said he suffered significant financial damage. He sued Butselaar for several hundred thousand euros, but the court ruled in favor of the tax attorney.