Aldo Gucci, former chairman of the worldwide Gucci clothing and leather goods empire, pleaded guilty today to using phony foreign companies to evade more than $7 million in U.S. income taxes.
The 80-year-old son of the founder of the company, which is based in Florence, wept during his 15-minute appearance before U.S. District Judge Vincent Broderick and proclaimed his "love for the United States."
Gucci, who has been a legal resident of the United States since 1977 but is not an American citizen, faces up to 15 years in prison and a $30,000 fine. He will also have to pay court costs and tax penalties that have not yet been determined.
He nervously answered "Yes, sir" and "No, sir" to a series of questions put to him by the judge and answered "No, sir," when asked if he had been coerced into pleading guilty.
The government charged that Gucci, who retired as chairman of Gucci Shops Inc., as well as of its Italian parent company in November 1984 and no longer has a role in its management, underreported his U.S. personal taxable income by about $11.8 million, on which there was a tax due of about $7.4 million. Although he pleaded guilty only to evading 1979 and 1980 income taxes, the government said he actually owed for the period from 1977-1982.
His guilty plea will bar further prosecution for any past tax violations, the government said.
Prosecutors said he paid $27,961 in personal income taxes for 1979, when the correct payment should have been $2 million, and $32,546 in 1980, when he should have paid $1.5 million.
Though Gucci was the only person charged in the case, Howard Wilson, assistant U.S. attorney for the Southern District of New York, said the investigation is continuing.