Matteo Marzotto’s tax trial was expected to end on Wednesday with Judge Orsola De Cristofaro’s verdict, but prosecutor Gaetano Ruta asked to reply to the defendants’ lawyers, who delivered their speeches at the end of last year. This in turn will lead to the latter’s additional remarks on Feb. 5 and 17.
“Nobody questions that there has been a capital gain of 80 million euros [almost $87 million at current exchange], the numbers reflect an exact science,” said Ruta. That once again brought attention onto International Capital Growth, based in Luxembourg, which the Italian tax police believes is a fictitious entity based in Luxembourg and managed in Milan, and allegedly created for the purpose of selling 29.9 percent of Valentino Fashion Group. Matteo and his sister Diamante Marzotto were indicted with other defendants for alleged omission of earnings declaration and tax evasion.
The allegations involve the Marzotto family’s association with the sale of VFG to private equity fund Permira in May 2007 for more than 782 million euros, or $849.2 million at current exchange rate. According to the indictment, taxes on the profit derived from the transaction were never paid in Italy. “The theme of the trial is to establish if the subject that secured a capital gain resides in Italy or outside the country and if this subject paid taxes in Italy,” Ruta claimed. “The Agenzia delle Entrate [Italy’s tax office] and the Guardia di Finanza [the State’s tax police] did not make any extraordinary discovery. Even lawyer Piergiorgio Palumbo had warned the Marzottos back in September 2008 of the risks [involved].”
Ruta, together with prosecutor Laura Pedio, also headed the Dolce & Gabbana trial, which ended with the acquittal of Domenico Dolce, Stefano Gabbana and other defendants. Ruta said he did “not gladly speak of this verdict,” because he did “not agree with it at all, I believe it is deeply wrong and unjust,” but added that he feels he will “have to talk about it now and for a long time.”
Throughout an extensive and impassioned technical speech, Ruta addressed the court urging the judge to consider “the instigators,” those who conceive of the schemes and who channel their behavior in a fraudulent way ‚ even when there are “several individuals that make it possible to avoid presenting one’s income taxes. The constructions are all similar because they are artificial.” Ruta claimed that “ behind the pen, there are many people and one does not understand why they should not be asked to respond [for their actions]. If there are factual elements, wouldn’t you,” he said addressing the judge, “feel more at ease condemning them?”
Ruta himself admitted to an oversimplification, but he spoke of instigators of murder crimes and how these are seen as relevant figures, and how right it would feel to condemn someone it there were “financial traces that would connect the instigator with the executor. Whether it’s a case of omission or an action, there is collusion.”
Ruta wondered why Matteo Marzotto, described throughout the trial as entirely against the sale of Valentino, had not taken a more aggressive stance and why other partners had also been silent. “The goal of the defendants was to earn a lot of money and not pay taxes. To make money is legitimate, it’s no crime, the problem is that on this amount you have to pay taxes,” said Ruta.
At the end of last year, the defendants’ lawyers had requested the judge to acquit their clients, contending there was no case to answer. Ruta was seeking one year and four months in prison for the Marzottos and defendant Massimo Caputi.