www.guardian.co.uk/frontpage/story/0,,1723226,00.html
Mills linked to mafia go-between
Poll reveals public support for minister
Ed Vulliamy, Ian Cobain and Julia Finch
Saturday March 4, 2006
The Guardian
Fresh doubts about the business affairs of Tessa Jowell's husband emerged yesterday with
the discovery that he set up a company whose directors included a man acting as the
intermediary between Silvio Berlusconi's political party and the mafia.
David Mills, a corporate lawyer, carried out the appointment of Marcello Dell'Utri as a
director on the board of Publitalia International, a London-registered media advertising
agency on the day of the company's incorporation in 1985.
Article continues
The two men had roles in the company for a decade; Mr Mills was company secretary until
1997, and Mr Dell'Utri was a director until 1995. Mr Dell'Utri, known as Mr Berlusconi's
braccio destra (right hand), was subsequently convicted of "mafia association", a crime
which the court in Sicily ruled he had been committing throughout the time he was on the
board, and for many years before.
The disclosure comes as a poll for the Guardian shows some support for Ms Jowell among
voters. About 44% said she should stay as culture secretary, and 29% thought she should be
required to resign, with 25% undecided.
Mr Mills confirmed yesterday that he had carried out the appointment of Mr Dell'Utri to
the board of Publieurope (as Publitalia International was later named), and that he had
made no checks on the Sicilian's background. But he said he had never met Mr Dell'Utri and
that he had agreed to the appointment at the request of one of his clients in Italy. That
client was Fininvest, owned by Mr Berlusconi.
"I have never met him in my life," Mr Mills said. "My client asked me to appoint somebody,
and I trust my client. I have no idea about him at all, I've read what you have in the
newspapers."
Mr Mills set up Publitalia International in 1985, and served as company secretary for 12
years. It was wound up 11 days ago, but its most recent accounts, in 2004, show it making
an annual profit of more than £2m. There is no suggestion that Mr Mills was aware of Mr
Dell'Utri's mafia associations, but the disclosure appears certain to intensify the
growing unease at Westminster about his business affairs.
On Thursday, Ms Jowell was cleared by the prime minister of breaching the ministerial code
after an inquiry by Sir Gus O'Donnell, the cabinet secretary, failed to answer any of the
questions about the couple's complex financial affairs.
At the heart of the controversy is £350,000 which Mr Mills got in either 1999 or 2000 and
which Italian authorities allege was a bribe from Mr Berlusconi. Mr Mills signed a
statement saying he received the cash after giving favourable evidence in court, but has
since withdrawn that statement and denies receiving a bribe. Prosecutors in Milan are
still trying to gather evidence that would ensure his indictment. Documents in the
Guardian's possession show that by the middle of last month they had not done so.
Mr Dell'Utri was convicted in 2004 and given nine years. He is appealing against
conviction, and is not in prison. Central to the prosecution case was that he mobilised
the mafia vote for Mr Berlusconi in 1994, before he became premier.
*****************************************************************
politics.guardian.co.uk/labour/story/0,,1723182,00.html
Ministers, moguls and murky deals - the curious world of David Mills
Tax avoidance expertise brought well-connected lawyer into contact with mafia go-between
and corrupt shipping magnate
Ed Vulliamy and Sandra Laville
Saturday March 4, 2006
The Guardian
Holding a glass of champagne, David Mills moved effortlessly through a throng which
included a cabinet minister, a permanent secretary to the Home Office and political
commentators; the great and good gathered together at a reception by the health thinktank
the King's Fund.
That night, less than a year ago, the skilled corporate lawyer dazzled within the heart of
a social court that reads like a Who's Who of the New Establishment.
Article continues
Today, the suntan, the gold signet ring and the designer suits are still in evidence, but
the sparkle has dimmed. As the facade of David Mills crumbles around him, his reputed
financial deftness has become as questionable as the company he keeps. For, through Silvio
Berlusconi, Mr Mills' reach has extended into the inner sanctum of Italian power, bringing
him into networks which have included some individuals with questionable histories.
The allegations against Mr Mills in Italy today date back to the early 1980s. An
Oxford-educated barrister, he had started working as a solicitor and become an expert in
offshore tax-avoidance schemes. He supplied his services in various guises: initially his
own firm, Mackenzie Mills, then as head of the British branch of a Milan law firm,
Carnelutti, and then, over a crucial period, as director of a company called CMM Corporate
Services (Carnelutti Mackenzie Mills), which - on Mr Berlusconi's behalf - handled the
legal affairs of several offshore companies. CMM acted as company secretary to 17 of them.
Mr Mills has told Italian magistrates that the summary sheet of each would be marked "very
discreet".
He had, in essence, to devise a miasma of offshore companies which, although part of Mr
Berlusconi's empire and its parent company, Fininvest, would hide Mr Berlusconi's
ownership. (At one stage, Mr Mills himself became beneficial owner of one TV channel,
through a company, Horizon, registered in the British Virgin Islands.) This kind of
service was his speciality - for a clutch of smaller businessmen, and for many Italian
clients, including the designer Valentino.
By 1992, Mr Mills' firm had, by his own account, hundreds of clients, including Benetton,
as well as Fininvest.
By the time Mr Berlusconi was first voted into power in 1994, Milanese prosecutors had
begun poring over the books of Fininvest searching for evidence of "black funds": cash
spirited out of Italy so as not to appear on the balance sheets.
In search of the offshore operation, the investigators commissioned an audit from the
accountants KPMG. Italian court records and KPMG's findings combine to show Mr Mills as
integral to setting up the labyrinth of offshore companies which prosecutors allege was
then used by Mr Berlusconi to bribe, corrupt and illegally fund politicians. Mr Mills has
been interviewed in at least two continuing investigations in which Mr Berlusconi is
charged with embezzlement and tax evasion. Committal proceedings are under way in
connection with accusations against Mr Mills of money laundering and tax evasion. Both
strongly deny the accusations.
Mr Mills served as company secretary of a Berlusconi company at the same time as Marcello
Dell'Utri was a director. A silver-haired Sicilian who had worked for Mr Berlusconi since
the early 1970s, Mr Dell'Utri became the media tycoon's special secretary in the early
1970s.
In 1985 Mr Mills set up an advertising company, Publitalia International, in London, an
affiliate of Publitalia, a main pillar of Mr Berlusconi's empire. Mr Mills was made
company secretary some time before 1992, resigning in 1997, while Mr Dell'Utri was
appointed a director of the London company from 22 July 1985, the day of its incorporation
by Mr Mills, until 1995. Asked whether he knew Mr Dell'Utri, Mr Mills replied yesterday:
"No I didn't. I've never met him in my life. He was appointed by the Fininvest people."
Mr Mills said he made no inquiries into Mr Dell'Utri's standing before putting him on the
board. "My client asked me to appoint somebody, and I trust my client," he said.
While both worked for the company, Mr Dell'Utri was busy dealing with the mafia on behalf
of Mr Berlusconi. An Italian court has heard that the businessman-turned-politician needed
votes, while the Cosa Nostra needed a new political patron. The court found that Mr
Dell'Utri had become the go-between.
Mr Dell'Utri's mafia links began in his youth, the Palermo court heard, and in 1993 he met
with the the mafia's governing Cupola to successfully solicit its vote-gathering powers on
behalf of Mr Berlusconi. That was while Mr Dell'Utri was on the board of Publitalia
International - known from 1997 as Publieurope International Ltd, billing itself as "an
advertising agent and marketing consultant".
In 1996 Mr Dell'Utri was charged with concorso in associazione mafiosa - aiding and
abetting the mafia. After a five-year trial he was convicted and jailed for nine years. Mr
Dell'Utri has appealed and is at liberty; no date has yet been fixed for the hearing.
His trial was dominated by evidence from one of the most senior dons ever to turn
prosecution witness: Antonino Giuffre, known as Manuzza, The Hand, because one of his
hands is immobilised through polio. Giuffre told the court Mr Dell'Utri "was a person very
close to Cosa Nostra and at the same time an excellent reference for Berlusconi ... known
as a serious and trustworthy person".
By that time Mr Mills has severed his connection with Publieurope International in London,
resigning as company secretary in December 1997, seven months after his wife, Tessa
Jowell, had joined Tony Blair's euphoric inner circle at Labour's election victory party.
At the time Mr Mills was director of 26 companies and appeared untouchable. A list of his
clients makes colourful reading, among them the Benetton UK retail chain and the Renault
formula one team.
Others sprinkled through the list were were much less well known: a residents' management
company, Six Steeles Road Residents; Auschem ,which specialised, it said, in the
"preparation and spin of textiles"; and Libra UK, a film and video production company.
Amid this portfolio of clients, one other name is pertinent: Diego Attanasio.
A Neapolitan shipowner who now lives in London, Mr Attanasio was also in need of the
specialist help Mr Mills offered rich Italians seeking to minimise the wealth they handed
over to il Fisco, "the taxman". An offshore presence was, in any case, very useful in
shipping, an international business.
Mr Mills crafted Mr Attanasio a wall with which to keep his dealings from prying eyes.
Whether the humour was intentional or otherwise, it was christened the Hadrian Trust, and
formed in Guernsey in September 1996 - but Mr Attanasio subsequently felt it would be more
to his liking if it was based in the Bahamas.
Quite soon, Mr Attanasio would have an even more pressing reason for wanting to keep cash
offshore; the following year he was accused of corruption, arrested, and, in July 1997,
put in jail.
The same month, on the 23rd, his trust, administered by Mr Mills, made a transfer that
would to come to haunt both men. The sum of $2m (£1.1m) was sent to an account in
Switzerland. Some of the cash then made a round trip to Gibraltar, before ending up in
another account owned by the same company, Struie.
It was not the only strange thing about this second account. Over the next few years,
cash, often in huge sums, was paid into and out of it by at least eight individuals and
companies. The individuals, who include Flavio Briatore, the formula one mogul and former
boyfriend of the model Naomi Campbell, have told prosecutors they knew nothing of these
movements.
But they were certainly profitable. Over the three years from 1997 to 2000, as world stock
markets rocketed, the money in the account grew by some 40%.
Several transfers were made to accounts owned by Mr Mills or companies linked to him. But
the one that came to interest Italian prosecutors investigating the trading of TV rights
by Mr Berlusconi's offshore empire was one for $600,000. Chief prosecutor Fabio De
Pasquale and his colleague, Alfredo Robledo, have since become convinced that it was Mr
Mills' reward for the evidence he gave earlier in trials involving Mr Berlusconi, and that
it was wrapped into the $2m sent by the Hadrian Trust.
Though he initially agreed, Mr Mills now denies that vehemently, saying all the cash was
from Mr Attanasio and that, by mutual agreement, he received $600,000 of it.
The prosecutors have yet to prove their claim. Indeed, they have yet to bring charges.
And, even if they do, the charges could be thrown out by a judge before the case gets to
trial. Or rather, the first trial, for in Italy's idiosyncratic court system, there may
need to be three trials before a conviction and sentence.
By then, a law passed by the Berlusconi government last year may well have aborted the
entire exercise - because corruption is one of several offences for which there is now a
much tighter time limit.
The process will nevertheless have served to cast a piercing light into the discreet,
intriguing world of a London lawyer with friends in high and strange places. One of Ms
Jowell's fellow MPs suggested this week that the ebullient Mr Mills might have done better
to stick to some harmless conveyancing in the Home Counties. That was never really on the
cards.