LAGERFELD DENIES NEWEST SCANDAL TIES

Byline: Robert Murphy

PARIS — Karl Lagerfeld has again washed his hands of the political scandal here in which his name has resurfaced.
Reacting to front-page news reports over the weekend alleging Lagerfeld sought First Lady Bernadette Chirac’s help in 1995 to reduce his tax bill, the designer lashed out at the reports, calling them “stupid” and judgmental.
“I have to give no justification to a French paper,” Lagerfeld told WWD. “They think they are the judges.”
A story in the daily Le Figaro said magistrates discovered Lagerfeld had written a letter to Madame Chirac asking her to intervene on his behalf. The discovery was apparently made while investigating a potentially explosive political scandal involving a videotape Lagerfeld’s tax lawyer, Alain Belot, purportedly used to bargain down the designer’s taxes.
The investigators also reportedly uncovered a memo from the presidential Elysee Palace addressed to the finance ministry asking that Lagerfeld’s case be handled with kid gloves. The memo from the Elysee was said to explain why in 1995 Lagerfeld’s taxes for the period from 1989 to 1991 were reduced from $8 million to the $1.3 million he ultimately paid.
“Maybe Mr. Belot asked me to send a letter to Madame Chirac,” said Lagerfeld. “They [my lawyers] had written it — I suppose — and I only signed it, as I only signed without looking at the papers everything concerning this business.”
The Elysee has reportedly acknowledged Chirac received a letter from Lagerfeld, but said the First Lady did not respond and underlined that the presidential palace has no power in tax matters.
Elysee Palace officials could not be reached for comment.
The development is unrelated to initial allegations that Belot succeed in getting the then-Socialist finance minister Dominique Strauss-Kahn to reduce the tax bill Lagerfeld paid in 1999 — for the period from 1992 to 1998 — in exchange for a video describing illegal fund-raising by president Jacque Chirac’s Gaullist Rally for the Republic party.
Lagerfeld has categorically denied any involvement in the scandal and says he is serene, if unnerved, in the face of judges investigating his tax payments. “They cannot reopen my case,” Lagerfeld said. “So for me, the story is a non-event.”
Lagerfeld said investigators have not subpoenaed him for questioning and that French newspapers were playing up his role in the affair in order to add spice to their copy.

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