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Italy targets Prada fashion house for alleged tax evasion

Italian fashion designer Miuccia Prada and her husband Patrizio Bertelli, also Prada's chief executive, walk past a Prada logo in 2011.
Italian fashion designer Miuccia Prada and husband Patrizio Bertelli, Prada's chief executive, in 2011.Reuters reports the pair are being investigated by Italian tax authorities.Vincent Yu / AP

Italian tax authorities seem to be setting a new fashion -- targeting famous designers.

First it was Dolce & Gabbana. Now, Italian designer Miuccia Prada and her husband, Prada chief executive Patrizio Bertelli, are under investigation as part of a tax evasion probe by Milan prosecutors, three investigative sources told Reuters on Friday. 

A spokesman for lawyers representing Prada Holding, through which Miuccia, her siblings and husband control the luxury group, said he was not aware of the investigation. 

Milan's public prosecutor's office declined to comment. 

Prada Holding said in December it had completed a process of voluntary tax disclosure and planned to bring back to Italy assets held abroad, primarily in low-tax Netherlands - where the holding company was previously based - and Luxembourg. 

Prada Holding is the latest in a series of high-profile firms to land in the crosshairs of Italy's tax authorities, which have become more interventionist as economic crisis erodes their revenues. 

Fashion designers Domenico Dolce and Stefano Gabbana were given 20-month suspended prison sentences and a heavy fine last June. They denied any wrongdoing. 

Italy's Corriere della Sera newspaper said on Friday Prada and Bertelli had paid 420 million euros ($571 million) to Italy's tax agency to settle their tax affairs. The paper also said the two were under investigation despite the settlement. 

The investigative sources said the report in Corriere della Sera was correct and added that a Prada director was also under investigation in the same case. 

A source close to the matter said the money paid to Italian tax authorities was a routine transaction and not a fine. 

Prada's Chief Financial Officer Donatelli Galli said on a conference call in December the company had had "strong and continuing" discussions with Italian authorities and had agreed to pay to avoid further penalties.