July 7, 2006

Judge orders Berlusconi stand trial in fraud case

By Emilio Parodi and Sophie Hardach

MILAN (Reuters) - An Italian judge on Friday ordered
ex-Prime Minister Silvio Berlusconi to stand trial for alleged
fraud at broadcaster Mediaset, the latest in a string of court
cases involving the country's richest man.

The case, which Berlusconi has dismissed as politically
motivated, follows a four-year investigation into claims of
embezzlement, false accounting, tax fraud and money laundering
in television rights deals between 1994 and 1999.

Berlusconi, a flamboyant showman who defied national
opinion and backed U.S. President George W. Bush's war in Iraq,
could face up to six years in jail for tax fraud if convicted.

But the permatanned 69-year-old has managed to avoid jail
in at least seven previous graft trials. He was found guilty
four times, but verdicts were overturned on appeal or the
statute of limitations applied and charges were dropped.

The decision to go to trial follows Berlusconi's razor-thin
defeat in April elections, which saw Italy's longest-serving
post-war prime minister ousted from power in what he angrily
claimed was a fraudulent result.

Nicknamed "The Knight," billionaire businessman Berlusconi
breezed into politics in 1994 promoting a "you can be rich like
me" message that Italians lapped up.


Berlusconi's first spell as prime minister did not last
long, but he came back to power in 2001 with a centre-right
coalition that defied Italy's reputation for revolving-door

He loves telling anecdotes about how he built his fortune,
selling crumpled-up newspaper to light stoves in post-war Italy
and using his charm as a cruise ship crooner, finally moving
into property in Milan and then into the media business.

Berlusconi had repeatedly accused magistrates of working on
behalf of the centre-left and said they would pursue him if he
lost power.

"It was a predictable decision, considering the previous
hearings in Milan," said Berlusconi's lawyer Niccolo Ghedini
after Friday's ruling. "They haven't allowed crucial witnesses
for the defense to be heard."

Among the 13 people also ordered to stand trial was British
lawyer David Mills, estranged husband of a British government
minister, and Mediaset Chairman Fedele Confalonieri, judicial
and legal sources said.

For two of the 13, the statute of limitations applies,
meaning they will not be tried.

Mediaset in a statement denied any crimes and said its
executives and directors had always acted correctly.

Prosecutors suspect a U.S. firm sold television and cinema
rights to two offshore firms controlled by a Berlusconi family
holding company, Fininvest.

The offshore firms then allegedly inflated the prices and
sold them to Mediaset, controlled by Fininvest, to avoid
Italian taxes and create a slush fund.

In a related case, Milan prosecutors have accused
Berlusconi of paying Mills a kickback of $600,000 for not
revealing details of his media empire when Mills testified in
two court cases.

Mills told Britain's Channel 4 news he was innocent and
said the case had nothing to do with his wife, Culture
Secretary Tessa Jowell, a close ally of British Prime Minister
Tony Blair.

"I'm absolutely convinced of my own innocence. I'm advised
I have a complete defense on the facts of the law ... and I'm
sure it will end all right. I think the only problem is I won't
have a chance to prove my innocence because this case will
collapse because of the statute of limitations...," he said.