MILAN — Italian authorities have arrested four people and are investigating more than 20 others, including the owner of cashmere knitwear firm Cruciani Srl, in connection with a possible 50 million euro, or $70.3 million, fraud.
The case relates to the alleged misuse and appropriation of European Union and state funds, which were allocated for the development of an industrial area near Salerno in southern Italy, police confirmed. About 34 million euros, or $47.8 million, of the 50 million euro, or $70.3 million, already has been spent.
The son of Cruciani owner Arnaldo Caprai denied his family’s involvement, telling WWD the company had operated a factory in Nocera Inferiore, near Salerno, since 2002 and employed 46 people there.
“We are certain of having acted legally and of being able to prove it,” Luca Caprai said. “We have never exploited any public fund.”
Also under investigation is Luca Mantellassi, the former owner of Bologna-based shoe firm Sutor Mantellassi Luxury Srl, and those under house arrest for criminal association and fraud include Fabio Borrelli, the owner of Neapolitan tailor Luigi Borrelli.
Borrelli’s lawyer declined to discuss the matter before court proceedings. “We are in a delicate phase,” attorney Vincenzo Vaio said. “What I can say is that [the case] has no bearing on the company, which is fully operational.”