Dolce and Gabbana sentenced to prison by Italian court

Fashion designers Domenico Dolce and Stefano Gabbana were sentenced to one year and eight months in prison by a Milan court for tax evasion.

Dolce & Gabbana

Domenico Dolce (right) and Stefano Gabbana were sentenced by Milan court for tax fraud (Credit: ykone.com)

Dolce and Gabbana were found guilty because they did not declare earnings estimated at over 1 billion euro.

The two stylists are charged for having stolen 840 million euros from IRS through inaccurate figures in their income statements.

Dolce & Gabbana, which includes celebrity customers such as Beyonce and Madonna, have systematically rejected the accusations that have been made.
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After being notified by the Italian tax office which has analyzed the case since 2007, the Court of Milan initiated in 2010 an investigation against the fashion houses and five other people that hid nearly 1 billion euros from the IRS. Stylists were acquitted on appeal in April 2011, but the procedure restarted from scratch in November 2011, after the annulment of that initial decision taken by the Court of Cassation, the highest Italian jurisdiction in criminal matters.

The two stars of the “prêt-à-porter” are charged for creating a series of bogus companies – one of them being Gado, an acronym of their surnames – in Luxembourg, in 2004 and 2005, and assigning them the control of the Group fashion brands in order to avoid the Italian tax system, when in fact those companies were managed from Italy.

Established since 1985, Dolce & Gabbana has over 3,000 employees, 250 stores in 40 countries and recorded a turnover of about 1 billion euros in the fiscal year 2011/2012.

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