A French court has acquitted Royal Bank of Canada's Bahamian wealth management subsidiary of complicity in an inheritance tax fraud case, according to a new regulatory filing.

French prosecutors were calling for RBC to be hit with the maximum fine allowed – €187,500 ($262,000 Canadian) – for its alleged role in a sophisticated tax fraud and money-laundering scheme involving billionaire international art dealer Guy Wildenstein and other family members.

RBC long denied any wrong doing, arguing "its actions did not violate French law," and nearly two years after the allegations were first made by France's tax evasion watchdog – Parquet national financier – RBC has been acquitted. Following the ruling, the prosecuting judge filed a notice of appeal.