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Bribery Probe in Italy Eyeing Fashion Industry

MILAN -- The dreaded moment has arrived here.<BR><BR>Investigating magistrates engaged in Italy's epic "Tangentopoli" ("Kickback City") corruption cleanup campaign have finally turned their sights on the fashion sector.<BR><BR>Milan magistrate Antonio...

MILAN — The dreaded moment has arrived here.

Investigating magistrates engaged in Italy’s epic “Tangentopoli” (“Kickback City”) corruption cleanup campaign have finally turned their sights on the fashion sector.

Milan magistrate Antonio Di Pietro interrogated Santo Versace, chief executive officer of the Versace fashion house, for several hours Monday in connection with probe of corruption in the ranks of the Guardia di Finanza, the national fiscal police. The investigation has already exposed tax officials who took bribes in return for closing an eye to fiscal improprieties at companies they were auditing.

The house of Versace declined to comment on the interrogation, but Versace’s lawyer, Alberto Moro Visconti, confirmed reports of the meeting. Visconti described the questioning of as a routine practice under the judges’ ongoing review of companies that were audited by the tax police from 1986 to 1993.

“The house of Versace was audited in 1990, and so the magistrates wanted to know the details of how the audit was carried out,” said Visconti.

“Versace met with one of Di Pietro’s assistants and then with Di Pietro himself. He told what he was asked about, and then he left. There weren’t any specific charges,” Visconti added.

Courthouse sources said Di Pietro also met on Monday with Krizia’s Mariuccia Mandelli, who reportedly made herself available even though she hadn’t been called to appear. There was no word on the content of her discussion with the magistrate.

Krizia chairman Aldo Pinto said he didn’t know anything about a meeting between Mandelli and the magistrate, and a Krizia spokeswoman later said the company had no comment on the report, which had been widely picked up by the Italian press.

A report late Tuesday that magistrates had also interrogated a member of the Buccellati jewelry family could not be confirmed.

Courthouse sources said a series of arrest warrants were being issued Tuesday night in connection with the investigation, which has already implicated more than 100 companies and some 50 tax officials. But, they said, the warrants didn’t name any fashion executives.

Hundreds of business people and fiscal officials have been interrogated over the last few months in the Guardia probe, which was launched early this summer and has focused on extortion by fiscal officials in exchange for favorable audits or lenient treatment of fiscal irregularities.

Dozens of arrests have already been made, including that of Paolo Berlusconi, the brother of Prime Minister, Silvio Berlusconi, for bribes paid by Berlusconi’s Fininvest media empire. Paolo Berlusconi was sent to jail in the early stages of the probe for refusing to cooperate with the magistrates. Silvio Berlusconi later claimed he knew nothing about a special slush fund that had been created at Fininvest to pay bribes to the tax officials.

Other firms that have been involved include Fiat investment company Gemina SpA, Milan merchant bank Mediobanca, department store chain Rinascente, Swiss drug giant Sandoz Ltd. and French cosmetics group L’Oréal.

Three top officers of the tax police have committed suicide over the investigation.

The investigation follows Italy’s epic political corruption scandal last year, which practically made Di Pietro into a folk hero for his work in uncovering systemtic kickbacks paid by industry for public works contracts.

Ironically, Gianni Versace himself lashed out at the magistrates’ anti-corruption campaign just last week from Berlin, where he inaugurated his Signatures exhibit at the Kunstgewebermuseum and opened a boutique.

“Sometimes I’m ashamed of being Italian,” Versace told the Italian reporters who followed him to Berlin. “Our industry, including the fashion industry, isn’t helped or supported by anyone.

“All you read about these days is Tangentopoli. They’ve investigated everyone,” Versace said. “Only the saints are left.”