Berlusconi sentenced to year in jail for tax fraud

‘INCREDIBLE AND INTOLERABLE’::The former Italian PM was found to have inflated prices paid for distribution rights and created foreign slush funds to avoid paying taxes


Sun, Oct 28, 2012 - Page 6

Former Italian prime minister Silvio Berlusconi was on Friday sentenced to four years in jail — quickly reduced to one — for tax fraud, with Italy’s lengthy appeals process likely to ensure he never sees the inside of a prison cell.

Scandal-hit Berlusconi, 76, condemned the sentence as “intolerable judicial harassment,” a week after he denied hosting raunchy parties and having sex with an underage prostitute in a separate case.

The four-year term was immediately cut to one under an amnesty law approved in 2006 by the then center-left government to reduce the overcrowding of Italian prisons.

Berlusconi was also banned from holding public office for five years by the Milan court.

His lawyers said late on Friday they would appeal by Nov. 10, according to reports, automatically suspending the application of the sentence.

However, Berlusconi is considered certain to stave off any imprisonment or ban on his political activities through appeals. The verdict, connected to his Mediaset empire, came two days after he announced his retirement from politics.

His lawyer branded the verdict as “absolutely unbelievable.”

“This is an incredible and intolerable political sentence. This is no doubt a political verdict, as political as all trials fabricated against me,” Berlusconi said on his Italia 1 TV channel.

During the trial, which began six years ago, but was repeatedly suspended, Berlusconi was accused of artificially inflating the price of distribution rights bought by his companies and of creating foreign slush funds to avoid paying taxes in Italy.

The court also sentenced the media tycoon and 10 co-defendants to pay 10 million euros (US$13 million) to Italian tax authorities for losses in what they called “large-scale fraud.”

The tax scam helped to create secret overseas accounts and reduce profits to pay fewer taxes in Italy.

The prosecution had asked for a prison sentence of three years and eight months for Berlusconi, the longest-serving prime minister of post-war Italy.

Prosecutor Fabio De Pasquale said in June that Mediaset costs for the films had been inflated by US$368 million from 1994 to 1998, and by 40 million euros from 2001 to 2003.

Berlusconi was at “the top of the chain of command in the sector of television rights until 1998,” De Pasquale said at the time.

He had asked for a prison sentence of three years and four months for Mediaset president Fedele Confalonieri.

However, Berlusconi’s close aide in his business dealings was acquitted on Friday.

Mediaset shares tumbled 3.11 percent to 1.338 euros at Friday’s close.

In court a week ago, Berlusconi was accused of paying for sex with then 17-year-old Moroccan exotic dancer Karima el-Mahroug.

He is also charged with abusing his position as prime minister by telling police to release her when she was arrested for petty theft in May 2010.

“I never had an intimate relationship of any kind with her,” he told the court in only his second appearance at the trial in Milan, which began last year and has heard from witnesses describing stripshows at his home.

The charge of exploiting an underage prostitute in Italy carries a maximum sentence of three years in prison and abuse of power up to 12 years.

Hollywood star George Clooney failed to appear on Friday to give evidence in the sex trial, leading the prosecutor to accuse the defense of seeking to slow the proceedings.

The sex trial was one of the last in a series of scandals that helped precipitate Berlusconi’s downfall in November last year, which was finally triggered by a parliamentary revolt against him and a wave of panic on financial markets.

Berlusconi, who owns AC Milan football club, three national TV channels and several private villas, has frequently accused “leftist” prosecutors, notably in Milan, of plotting against him.

He said on Wednesday he would not run in elections early next year and would hand his People of Freedom (PDL) party over to a successor, ending months of uncertainty over his candidacy.