Financial regulators in Italyhave issued a statement accusing Halfords Media Italy S.r.l., a PokerStarsowned marketing group, of skirting its tax obligation in the country to the tune of €300 million. Italy’s financial police, the Guardia di Finanza del Comando Provinciale di Roma, allege that PokerStars used a financial practice called “transfer pricing” to artificially lower its taxable income from 2009 to 2014.

The practice is common in the business world and allows large companies to buy goods and services from their own subsidiaries. The problem arises when a company uses transfer pricing to fraudulently shift profits earned in a high tax burden country (e.g. Italy) to a country with a lower one (e.g. Isle of Man and Malta). Regulators believe that Halfords under-charged PokerStars for services rendered in Italy, thus reducing its profit there and increasing its profits in low tax countries.

PokerStars Head of Corporate Communication Eric Hollreiser issued a statement saying that the company has been working with Italian authorities “since it launched an audit several years ago.”

“We have operated in compliance with the applicable local tax regulations and have paid €120 million over the period covered by the audit,” he added. He assured that the investigation will not affect players on its Italian network. “[We will] continue as usual on PokerStars.it and we remain focused on delivering the most popular online poker service in the Italian market.”

PokerStars has had a huge effect on the i-poker industry in Italy. Research conducted by Morgan Stanley showed that the online gambling giant singlehandedly grew the entire country’s i-gaming market by 62% in just one year. Before PokerStars’ entry into the market, the Italian i-poker industry was in a severe decline due to the requirement that games be “ring-fenced” and blocked from connecting with networks out of the country.

Italy’s financial authorities are seemingly unmoved by those figures and have formally charged the CEO of Halfords with tax fraud in an operation they call “All-In.”

Amaya Gamingwas already aware of the pending investigation when it acquired PokerStars for $4.9 billion last year. In a statement issued on Wednesday, the Canadian-based gaming firm said, “The merger agreement related to that transaction provides remedies to address certain income tax and other liabilities that might occur post-closing but stemming from operations prior to the date of acquisition.”

“Like many other global e-commerce companies, we vigorously dispute the stance of the tax authority regarding local establishment,” said Hollreiser. “The audit is ongoing and we hope to resolve the issue in our favor soon.”

Amaya is also facing scrutiny in Canada, where investigators from that country’s regulatory body have opened an investigation due to the unusual trading volume of Amaya stock around the time of its acquisition of PokerStars. Some 300 traders and investors have been singled out by the Autorite des Marches Financiers for further investigation.

Yoel Altman, an Amaya accountant and good friend of company CEO David Baazov, was revealed as one of the people targeted by Wall Street’s Financial Industry Regulatory Authority. Toronto businessman John Fielding is also being investigated after buying $2 million of Amaya stock just before the PokerStars acquisition announcement was made. In the days leading up to the sale, Amaya stock doubled, then doubled again, surging to a new high of $30 a share.

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