ROME, Aug. 29 (UPI) -- Ex-Italian Prime Minister Silvio Berlusconi devised a system for his media empire to avoid taxes even after he gave up active control, judges said Thursday.
In explaining their justification for upholding Berlusconi's Aug. 1 conviction for tax fraud, the Italian Supreme Cassation Court judges said he was "creator of the mechanism for twisting [film] rights" for Mediaset "that over a distance of years continued to produce [illegal] effects, reducing taxes for the companies that he headed in many ways," the Italian news agency ANSA reported
The judges called called it "a systematic game of mirrors."
The judges found Berlusconi set up a system in which offshore companies bought the rights to Hollywood films for Mediaset, which then repurchased the rights at inflated rates, leading to higher costs and smaller margins on which to pay taxes in Italy.
The judges said the tax-avoidance system was "without commercial justification" and continued after Berlusconi removed himself from the corporate leadership because he hand-picked those who ran the business after he left, ANSA said.
This month, Berlusconi was given a four-year prison term that was reduced to one year of house arrest. He also is banned from holding public office for five years. The conviction threatens to leave Berlusconi stripped of his seat in the Italian Senate and to torpedo the country's fledgling left-right ruling coalition, the news agency said.
The Senate is expected to vote Sept. 9 on removing Berlusconi from office.
