Domenico Dolce and Stefano Gabbana are found guilty of
hiding hundreds of millions of euros from the tax authorities by allegedly
transferring their firm to a holding company in Luxembourg.
Famous designer duo Domenico Dolce and Stefano Gabbana
have been found guilty Wednesday, June 19 of evading taxes in their home
country, Italy. They were sentenced to 20 months in prison and were ordered to
pay heavy fines by a Milan court.
Dolce & Gabbana were accused of selling their company
to a Luxembourg-based firm, Gado, in 2004 to avoid declaring taxes on
approximately 1 billion euros ($1.3 billion). Prosecutors claimed Gado is a
shell company that made no administrative or financial decisions.
The designers whose clients include Madonna and Kate Moss
among other high-profile celebrities had initially been acquitted of tax fraud
in 2011 when a judge ruled there was not enough evidence to indict them, but
the highest Italian court overturned the ruling.
Prosecutors wanted Dolce & Gabbana to spend two and a
half year in jail for the tax evasion, but the judge granted them only 20
months in prison. In addition, the designers were ordered to pay 500,000 euros
as a first installment of a fine that could reach millions of euros.
D&G's lawyers said they were "frankly
stunned" by the verdict and were "certain that it will be overturned
on appeal." One of the lawyers, Massimo Dinoia, said as quoted by Reuters,
"We will read the reasons for the verdict, and we will appeal."
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