Philanthropist misses arraignment, said to be in
By TOM BELL
The Associated Press
4/21/2004, 4:42 p.m. ET
TRENTON, N.J. (AP) — A philanthropist best known for selling millions of dollars worth of musical
instruments at a discount to the New Jersey Symphony Orchestra has fled to Cuba to avoid tax
fraud charges, authorities said Wednesday.
A federal judge issued an arrest warrant for animal publishing tycoon Herbert Axelrod after he failed
to show up for an arraignment on charges that he hid income from the Internal Revenue Service.
Assistant U.S. Attorney Michael Guadagno said Axelrod's yacht was docked in Cuba and that the
multimillionaire was staying at the Marina Hemingway, a four-star resort in Havana. The United
States has no extradition treaty with Cuba.
Guadagno said Axelrod, 76, was aware of the charges against him and the court hearing scheduled
for Wednesday. An Axelrod associate told the U.S. Attorney's Office that Axelrod recently traveled
from Zurich, Switzerland, to Cuba and had no intention of returning to this country, Guadagno told
U.S. District Court Judge Garrett Brown. Guadagno refused to identify the Axelrod associate.
Attorney Michael Himmel, who had been representing Axelrod, said he had notified Axelrod of the
indictment and Wednesday's court hearing, Guadagno told the judge. But Himmel, who did not
attend Wednesday's proceeding, said that he had not been retained by Axelrod for the tax case.
Himmel said during a telephone interview that he represented Axelrod during the grand jury process
but was not retained for Wednesday's hearing. Himmel said he does not know where Axelrod is.
Axelrod was charged with using Swiss bank accounts to hide income from the IRS related to the
publishing company he owned that specialized in books on animals and pets.
The indictment said that between 1990 and 1996, Axelrod gave an executive of his publishing
company $700,000 in bonus payments, deposited into Swiss bank accounts.
When the executive was fired he was given $950,000 in severance. Of that, $775,000 went into the
Swiss accounts, the indictment said. It said Axelrod told the employee the IRS could not obtain
records of the Swiss accounts and told him not to disclose their existence.
Axelrod was charged with conspiracy to defraud the IRS and aiding the filing of a false tax return.
Guadagno said Axelrod recently sold his home in Deal, N.J., for $6.5 million and that over the last
year he had liquidated a number of other properties, including several in Key West, Fla. The value of
the other properties was not known, the assistant U.S. attorney said.
In February 2003, Axelrod sold 30 rare Italian string instruments he had collected, which were valued
at $50 million, to the NJSO for $18 million. Axelrod originally wanted to sell the violins to the
orchestra for $25 million, but eventually settled for the smaller amount when officials couldn't come
up quickly with the higher amount.