Mayor of Venice arrested over kickback scandal

Mayor Giorgio Orsoni was arrested over a slush fund linked to the Moses project. Picture: AP

Centre-left mayor Giorgio Orsoni was placed under house arrest as 300 officers mounted raids across Italy, seizing e40 million (£32.5m) in assets after a three-year investigation into an alleged e25m slush fund created by companies working on the so-called Moses project.

The investigation will put further pressure on Italian prime minister Matteo Renzi to make good on promises to crack down on the deep-seated corruption that has plagued Italian public works contracting for decades.

Investigators also requested the arrest of Giancarlo Galan, a former governor of the Veneto region and backer of former prime minister Silvio Berlusconi, who is accused of taking annual bribes of e1m between 2005 and 2011. Now a senator in Rome, Mr Galan’s arrest must be approved by the Italian parliament. He has denied the allegations.

Prosecutors said they followed a complex cash trail between the firms and politicians which passed through the tiny state of San Marino, as well as overseas banks.

A former Italian treasury official, Marco Milanese, is under investigation, suspected of taking a e500,000 bribe to ensure the project received government  financing.

And the former president of the consortium building the barrier, Giovanni Mazzacurati, was placed under house arrest yesterday accused of being “the grand puppeteer” behind the distribution of bribes.

Launched in 2003 and due for completion in 2016, the e5.5 billion Moses project will protect Venice from ever more frequent “high waters” which leave St Mark’s Square knee deep in water and force tourists and residents to walk on raised wooden platforms.

Some 191 high waters measuring 110cm or more hit Venice between 1966 and 2010, up from 21 between 1926 and 1965, because of stronger winds and extreme weather in the Mediterranean as it heats up due to climate change. Making matters worse, Venice sank by 23cm over the past century, possibly due to ground water extraction under the Venice lagoon.

The ambitious plan, which is 80 per cent completed, sees 78 flood barriers, measuring up to 30 metres long, set up at entry points into the lagoon. In calm seas, the barriers sit on the sea floor filled with water, but they can be pumped full of compressed air to raise them when high waters threaten.

A lawyer for Mr Orsoni said the allegations that he received illegal campaign financing from firms working on the project were “barely credible”, although a former Venice mayor, Massimo Cacciari, said there was little accountability on the project. “I said it a million times but no-one listened,” he said.

The arrests are the latest in a series of investigations into kickbacks linked to large public works in Italy, from the country’s hosting of the G8 in 2009 to the World Swimming Championships in Rome that same year, to Milan’s hosting of the Expo in 2015.

The Venice inquiry recalls the Tangentopoli, or Clean Hands, scandal which destroyed most of Italy’s political parties in the early 1990s.

“Politicians have learned nothing,” said prosecutor Carlo Nordio yesterday. “We have discovered a system very similar to Tangentopoli, involving characters who were involved back then, but more complex and sophisticated.”

Mr Nordio said that battling corruption with new, ever more complicated legislation was making things worse, not better.

“I have said it for years, and I repeat it today,” he said. “One of the causes of corruption is the muddled and complicated state of our laws. To cut corruption you need fewer, simpler laws.”