Italy probes AC Milan sale for money laundering

An Italian newspaper said Italian prosecutors have begun a probe into whether the deal to sell AC Milan to Chinese investors last year was inflated for money-laundering.

La Stampa reported on Saturday that Milan prosecutors want to know if the 740 million euros ($786 million) paid to Silvio Berlusconi to buy out the seven-time European champions was overvalued in a deliberate move to bring large sums of money into Italy from abroad, the newspaper said.

It has not immediately been possible to confirm the opening of the investigation with Milan prosecutors or lawyers for Berlusconi, the former Italian prime minister.

After more than 30 years in the hands of Berlusconi, a glorious period which saw the club win 29 trophies including five European Cups, Milan were sold on April 13 last year to a group of Chinese investors led by Li Yonghong.

The consortium took 99.93 percent of the club’s shares and also bought out its debt, which stood at 220 million euros on June 30, 2016.

But the number of investors has progressively diminished in the face of difficulties in getting the funds out of China, where tougher legislation on the movement of money abroad was recently introduced.

Li was forced to set up his company in Luxembourg and obtain financial support from the US investment fund Elliott in order to push the deal through.

Elliott agreed to lend more than 300 million euros, but at interest rates of up to 11 percent and with full repayment within 18 months, according to Italian media.

Milan lavished large sums on new signings prior to this season but the Rossoneri are struggling in 11th place in Serie A, 23 points behind leaders Napoli.