KEY POINTS:
TURIN - England soccer coach Fabio Capello is being investigated for tax fraud by prosecutors in the northern Italian city of Turin, a legal source said on Wednesday.
The source said the investigation had been going on for around a year and involved whether Capello should have been paying Italian taxes on money, earned from sponsors, which the coach was holding abroad.
A company called Lussemburghese Sport 3000, controlled by the Capello Family Trust and based in the island of Guernsey, is being probed but the exact amount of taxes the authorities are querying will not be known for some weeks.
The source could only say that investigators are checking to see if "millions" of euros have gone undeclared.
Capello, who officially started as England coach last week, said in a statement on the FA Website (www.thefa.com) his finances were in order and he was not aware of any matters which would be of concern.
"With my advisors, I have always endeavoured to conduct my financial business with integrity.
"I have assured The FA today that my finances are in order and that I am not aware of any matters which would be of concern. I understand that these inquiries in Italy are part of a wider investigation into the finances of many high profile individuals."
Capello's lawyer Alberto Moro Visconti told reporters in Turin: "The transactions that have been reported are not attempts at tax evasion, but are absolutely lawful commercial transactions, made in the public domain. When the moment is right we will explain it to the magistrate."
An FA spokesman added: "It is our understanding that the Italian tax authorities are currently following a procedure of looking into the finances of numerous high profile individuals - particularly in sport.
"We have spoken to Fabio and his advisors about today's newspaper report in Italy and they have explained the facts. They have also given us their assurance that Fabio's tax payments are in order."
Several top Italian sports personalities have been investigated by tax authorities including former MotoGP world champion Valentino Rossi, who was probed because he was based in Britain while also spending a significant amount of time in Italy.
Capello was appointed England coach in December having won domestic titles with all four of the clubs he managed - AC Milan, Real Madrid, AS Roma and Juventus.
The 61-year-old's last job was at Real Madrid for a second time, where he was sacked last June despite winning the league.
As well as living in Spain for a time, he has a home north of Milan and also owns a house in Switzerland.
"It is a tax inspection sparked by controls on the balance sheet of Juventus, a part (of the probe that dates back) from some time ago and is known to everyone," Capello's son and agent Pierfilippo told www.gazzetta.it.
"It follows the modus operandi adopted up to now to check the earnings of famous people. One of the reasons for this method is that these people, like my father, often change residence because of work."
- REUTERS
