Dolce & Gabbana Sentenced to Prison for Tax Evasion
The sentence was suspended -- and under Italian law, the fashion designers would likely serve that time under house arrest after a conviction tied to the 2004 sale of D&G brands to a Luxembourg holding company.
An Italian judge has sentenced famed fashion designers Domenico Dolce and Stefano Gabbana to a year and eight months in prison for avoiding taxes in the 2004 sale of their D&G and Dolce & Gabbana brands to a Luxembourg holding company.
However, the sentence was suspended -- and under Italian law, sentences of less than three years are typically served via house arrest or community service, the Wall Street Journal reports. Neither man appeared at today's hearing, and both have repeatedly declared their innocence.
They've also been ordered to pay 343.4 million euros -- plus interest -- over the deal, criticized by the judge as a way to avoid declaring taxes on royalties of about one billion euros, or $1.3 billion. Bloomberg named them to its annual Billionaires List for the first time in 2013, noting that a rising global demand for luxury goods drove up the valuations of big fashion brands, boosting the net worth of their owners and top executives.
The news organization valued privately-held Dolce & Gabbana at $5.3 billion in January, and estimated the net worth of the 54-year-old Dolce, who owns a 41.8 percent stake in the company, at $2.2 billion. Gabbana, 50, who controls a 40 percent stake, is worth an estimated $2.1 billion, according to Bloomberg.
The brand, known for sexy corset dresses and a penchant for leopard print, is a favorite among Hollywood heavyweights, including Kate Moss, Kylie Minogue, and Man of Steel star Amy Adams, who wore a white, strapless tea-length stunner to the film's Taormina Film Fest premiere on Saturday.