A former Victoria businessman arrested in Britain last week after spending 15 years on the run from an income-tax evasion charge is expected to learn on Friday when he will face an extradition hearing.

A London judge has set Frank Hertel's bail at £500,000, or just over $900,000 Cdn, but it is not known whether he can afford to post the amount. He has also surrendered his passport.

The RCMP said an arrest warrant was issued for Hertel in 1994 after he was accused of making false income tax statements and tax evasion involving $18 million in 1986. He is charged with one count of tax evasion in Canada.

Hertel first arrived in Victoria in the early 1980s, making a splash in the local business community by promising to turn the city into a high-tech centre. His company took over a massive office building downtown with a focus on oil and thermal power.

He was named Citizen of the Year by the Chamber of Commerce, but later fled to Venezuela, then to Europe, eventually making his way to Germany. Canadian authorities tracked his movements, but couldn't seek extradition because the proper treaties weren't in place.

The RCMP recently got word that Hertel would be flying to London from Germany. British police arrested him when he arrived at Heathrow Airport on May 9.

"It was immediately apparent to us that this was real-time information and we were able to activate our partners in Interpol and have him arrested," Cpl. Darren Lagan told CBC News.

George Jones, one of Hertel's former lawyers, said the businessman simply got caught up in a federal government program that issued grants for scientific research.

"The big corporations, on behalf of the government, would advance scientists say $20 million, but then they would have to repay that within a year," he said.

It isn't clear where the money went, or whether it was paid back, Jones added.

Hertel remains in a London jail.

With files from The Canadian Press