A European tax adviser to a global set of star DJs and supermodels has been arrested on charges that he created a network of illegal tax shelters to help his clients avoid paying U.S taxes on over $100 million of earnings.
Frank Butselaar, 63, of the Netherlands, is accused of setting up a complex array of illegal offshore tax vehicles and trust structures to hide millions of dollars in income his clients earned while working around the world.
Federal prosecutors in the U.S. say the scheme helped obscure over $100 million in revenue that would have been subject to U.S. tax in years where Butselaar’s clients did extensive work in the United States.
Court documents do not name Butselaar’s clients who he allegedly helped through the scheme, referring to them only as “internationally renowned disc jockeys” on the electronic dance music scene, but the respected Dutch newspaper, Het Financieele Dagblad, identified two of them as the DJs Tiësto and Afrojack, both of whom are Dutch.
Messages left for representatives for Tiësto and Afrojack weren’t immediately returned.
Tiësto is considered by many to be the “godfather” of the modern electronic dance music scene. In 2017, Forbes estimated that Tiësto earned $39 million that year. Afrojack, who stands 6-foot-10 and is married to Italian singer, Elletra Lamborghini, an heiress to the race car company fortune, is similarly considered one of the highest-paid DJs in the world, according to Forbes.
Butselaar was detained at his vacation home in Italy pending extradition to the U.S. to face tax evasion charges, according to Damian Williams, the U.S. attorney for the Southern District of New York, where the indictment was unsealed this week.
He had previously been detained by Italian police in March, but had been released pending a ruling by a judge on extradition.
Annabel Vissers, an attorney for Butselaar in the Netherlands couldn’t immediately be reached for comment, but she told the Dutch newspaper that her client’s arrest was disappointing.
“It is regrettable that this is how it is. It is also remarkable that the arrest of my client has now been ordered because he is an alleged flight risk. He was under house arrest in his own holiday home for three months and knew this was coming,” she told the paper.
According to U.S. prosecutors and investigators with the Internal Revenue Service, Butselaar steered millions of dollars into offshore entities in Cyprus and the Channel Islands that were set up to obscure their connection to his clients.
Butselaar is also accused of setting up vehicles in which he transferred earnings by his fashion model clients to relatives to hide the models’ connection to the money.