(Bloomberg) The Wildenstein family of art dealers sold more than 600 pieces since the turn of the century, generating around $300 million in cash to fund their lifestyle, and has works worth nearly three times that much in storage, according to a banker who has intricate financial knowledge of the clan’s dealings.

Daniel Wildenstein created an offshore trust in the Bahamas in 1998 to lodge 2,500 works from the art dealer’s collection. A Royal Bank of Canada unit managed it, and a representative told a Paris court this week that its sole purpose was to provide funds for the family.

“There were sales in order to generate the money for making distributions to support their lifestyles,” RBC’s Brian Taylor said during the third day of the trial of Daniel’s son, Guy, and grandson, Alec Junior.

They stand accused of hiding assets worth hundreds of millions of euros to slash inheritance taxes after Daniel’s death in 2001.

The trial at Paris’ criminal court, which will last until Oct. 20, provides insight on the family’s business secrets, which were so fiercely held that Guy Wildenstein said he didn’t learn of many of the financial machinations until his father’s death.

When he transferred the works of art to the so-called Delta Trust in the Bahamas, Daniel had valued the assets at $1.1 billion. The trustee at the time didn’t second-guess that assessment, and neither did the current one, the Royal Bank of Canada Trust Co.

Art Sales
The collection held by the trust has been gradually thinned, with around 71 million euros ($79.7 million) distributed between 2001 and 2004, including more than 30 million euros in works of art, Taylor told the court. About 675 works have been sold since then, generating about $238 million for family members, he said.

A lot still remains untouched. No cash distributions have been made to the family since the end of 2013, leaving a collection worth approximately $875 million sitting in storage in the U.S., Switzerland and Singapore, Taylor said.

$1 Million
“Currently, I don’t have much left. I have to check but I’ve got less than $1 million,” said Alec Wildenstein Junior, who got $4 million in proceeds from the sale of several Pierre Bonnard works around 2013. “We haven’t received any distribution in the last few years.”

The Wildenstein family entered the art world in the 1870s in Paris when Nathan Wildenstein, Guy’s great-grandfather, helped a client sell some paintings while he was working as a tailor. Nathan opened his own gallery the same decade. His firm, Wildenstein & Co., has been family-run since then.

Five generations later, the art-dealing tradition continues through Guy, in charge of the Wildenstein Institute, whose “catalogues raisonnés” for the most important artists of the 19th and 20th centuries are so exhaustive that a work by Monet would be worthless without a so-called Wildenstein index number.

The family’s days of hoarding acquisitions may be over. While sales have proceeded, the family’s disinterest in contemporary art means no new works have been purchased for the trust since its creation.

“The contemporary art market isn’t my craft,” Guy Wildenstein said, adding that buying very expensive works “that might be worthless tomorrow” didn’t make sense to him. “I stuck to what I knew well.”

Fiscal Risks
Guy said he didn’t know there was any fiscal risk when he didn’t declare the trusts in his inheritance-tax bill, and none of his advisers and lawyers told him of any, according to the court indictment.

The assets held in trusts weren’t legally Daniel’s, his lawyers have said. Instead, they belonged to the trusts and therefore shouldn’t count for estate taxes. French prosecutors argue that the trusts aren’t truly independent, pointing to evidence that the Delta Trust became a source of bounty for Guy and his brother Alec, who died in 2008.

Unaware of the trusts when it settled in 2002, France accepted a set of bas-reliefs by Marie Antoinette’s favorite sculptor to cover an estate tax bill it believed worth no more than 17.7 million euros. It was alerted to the trust several years later as Daniel’s second wife, Sylvia, fought for her share.

Daniel’s Death
In October 2001, Daniel, who had battled cancer, fell into a coma and died. Two weeks later, Sylvia signed away her rights to her late husband’s estate. According to Sylvia, her stepsons—Guy and Alec—told her the taxes would bankrupt her if she didn’t. Several years later, she sued Guy and Alec claiming she was cheated out of her inheritance and that the family was sitting on trusts and real estate worth billions.

Guy Wildenstein also told the Paris court he didn’t know why $188 million’s worth of paintings were moved to Switzerland from the U.S. while his father was dying. The only thing Guy said he knew was that Daniel had decided to reorganize the Delta Trust in July. Because of the complexity of moving art, items were still being shipped when he died.

The Royal Bank of Canada unit in the Bahamas didn’t learn of the shipments until more than a decade later and informed the U.S. Internal Revenue Service soon after. In total, the U.S. authorities were deprived of $136 million in estate tax due to the movements of the paintings, according to the indictment.

Guy Wildenstein hinted at one possible reason for his ignorance about Daniel’s business affairs.

“My father was a man of few words,” Guy told the court, adding that while he was head of the household, everyone else was treated like a child. “That’s how things are in the family.”

—With assistance from James Tarmy

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