The Padova police used the historically effective investigative technique of following the money to uncover details of Dr. Michele Ferrari's links to riders, team managers and agents, and their use of image rights contracts to create secret funds to avoid paying tax and secretly pay their doctors.
According to further revelations and extracts published by Gazzetta dello Sport on Thursday, Ferrari was often paid for his coaching and suspected doping advice via a network of bank accounts and experts in Switzerland and Monaco, which helped riders avoid paying tax in their home countries. The 550 Padova document suggests the group's activities generated a turnover of close to €30 million in 2010 and 2011.
"The clear objective of the group was to falsely increase (by cheating, with doping) the value of the rider market and avoid paying tax on a large part of the earnings via well-tested systems of money laundering and investments, especially in property," Gazzetta quotes the Padova investigation document as saying.
It seems that evidence from Danilo Di Luca again proved to be vital in revealing initial details of how the system worked. Gazzetta report that Di Luca revealed the details of an image-rights contract he signed with a third-party company to avoid paying tax on the image rights he earned from his team and sponsors.
Accounts from 20 teams scrutinised
Gazzetta names the T&P Sport Management company based in Monaco as the fulcrum of the image rights deals for numerous riders, including Franco Pellizotti, Michele Scarponi, Denis Menchov and others from a multitude of teams. The Padova police studied the books of Liquigas, Androni, Katusha, RadioShack, Lampre, QuickStep, Geox, Colnago, Farnese, Acqua&Sapone, Astana, Vacansoleil, ISD, CSF, LPR, Diquigiovanni, Tinkoff, Rabobank, Gerolsteiner and Milram for the 2008, 2009, 2010 and 2011 seasons.
Former Cannondale and Liquigas team manager Roberto Amadio, former LPR team manager Fabio Bordonali and Claudio Fantin are listed as the directors of T&P Sport Management company. The Padova police suspect that rider agent Raimondo Scimone, who represented many of the riders linked to Dr. Ferrari, worked with the director of the Banca Svizzera Italiana in Locarno, T&P Sport Management lawyer Claudio Tessera and Rocco Taminelli, a lawyer from Bellinzona who was once part of the UCI Disciplinary Commission and went on to defend several riders in doping cases.
Riders are often paid a significant part of their salary via image rights contracts and the Padova police suspect that the T&P Sport Management company kept 5-6% of the amounts in exchange for their expert financial advice that helped riders avoid paying tax. It seems riders often used funds in their Swiss accounts to pay Dr. Ferrari. The USADA investigation into Lance Armstrong revealed that Dr. Ferrari used a Swiss bank account and company to collect payments. The Padova police also believed riders regularly collected cash from their Swiss bank accounts when racing in northern Italy and Switzerland.
According to Gazzetta, Michele Scarponi was paid 30% of his 700,000 Euro contract with Lampre in 2011 via an image rights contract. Scimone apparently spoke to him in a cryptic manner in telephone conversations about the funds and told him not to ask questions. The Astana rider was told to go to the bank in Switzerland, where the bank employee would make a call and resolve any problems.
Scimone warned riders to move their residence to Switzerland to avoid tax problems, revealing that Denis Menchov was investigated by Spanish tax officials and faced a bill of € 1 million.
Scimone has always denied any wrong doing to Cyclingnews.