Milan (AFP) – AC Milan president Li Yonghong has blasted Italian media reports claiming Italian prosecutors had opened an investigation into whether the deal to sell the club last year was inflated for money-laundering purposes.

Yonghong also threatened legal action against Italian dailies La Stampa and Il Secolo XIX, the two papers that published the same original story that claimed Milan prosecutors want to know if the 740 million euros ($786 million) paid by Chinese investors to former Italian Prime Minister Silvio Berlusconi to buy out the fallen Serie A giants last year was overvalued in a deliberate move to bring large sums of money into Italy from abroad.

“The AC Milan purchase process has always been carried out with the utmost transparency, compliance with regulations and correctness, with the support and advice of international financial and legal advisors,” said Yonghong in a statement on AC Milan’s official website.

“What I have read these days absolutely does not reflect the reality of facts… We reserve the right to take all necessary legal action to best protect the image, the reputation and the financial solidity of the companies of the AC Milan S.p.A. Group.”

The reports in the article published by La Stampa and Il Secolo XIX at the weekend were quickly denied by the Milan prosecutors office, but the papers refused to retract their joint story, claiming that they had been made aware of the investigation by two separate sources.

Italian media then reported on Monday that Milan prosecutors had received a report from the country’s finance police Guardia di Finanza (GdF) following the Bank of Italy’s financial information unit informing the GdF of three “suspicious operations” within the sale.

– ‘Politically motivated’ –

Niccolo Ghedini, Berlusconi’s long-time lawyer, claimed on Saturday that the story was false and politically motivated ahead of Italy’s upcoming general elections, which take place on March 4 and in which media magnate Berlusconi heads up Forza Italia, the country’s main centre-right political party.

“There is evident will to defame and that can only be explained by a desire to interfere in the elections,” Ghedini said.

Berlusconi has also personally denied any financial impropriety, claiming that he “would have to be stupid” to try to bring foreign capital back to Italy via such a highly publicised sale, and suggested that the reports were pure politics.

“Every time there is an electoral campaign in which I am expected to win, all sorts gets made up about me,” he said on Domenica Live, a show broadcast on Sunday on the Mediaset TV network he founded.

“This time they’ve invented a whopper that was quickly denied by the Milan prosecutors.”

After more than 30 years in the hands of Berlusconi, a glorious period which saw the club win 29 trophies including five European Cups, Milan were sold on April 13 last year to a group of Chinese investors led by Li.

The consortium took 99.93 percent of the club’s shares and also bought out its debt, which stood at 220 million euros on June 30, 2016.

But the number of investors has progressively diminished in the face of difficulties in getting the funds out of China, where tougher legislation on the movement of money abroad was recently introduced.

Li was forced to set up his company in Luxembourg and obtain financial support from the US investment fund Elliott in order to push the deal through.

Elliott agreed to lend more than 300 million euros, but at interest rates of up to 11 percent and with full repayment within 18 months, according to Italian media.

Milan lavished large sums on new signings prior to this season but the Rossoneri are struggling in 11th place in Serie A, 23 points behind leaders Napoli.