An Italian tax spy scandal widened on Friday when the list of those snooped on lengthened to include former premier Silvio Berlusconi and his children, past head of state Carlo Azeglio Ciampi and ex-Bank of Italy chief Antonio Fazio.
Sources close to the Milan probe said Berlusconi and his children Marina and Piersilvio, both top executives in Berlusconi's media-based business empire, had had their tax records illegally checked two or three times.
The same went for Ciampi; Fazio, who was forced to resign as Bank of Italy chief in a bank takeover scandal; former premier Lamberto Dini and his wife Donatella; and Stefano Ricucci, a real estate tycoon with links to Fazio who is under investigation for alleged market-rigging.
The spy furore erupted on Thursday when it emerged that the tax records of Premier Romano Prodi and his wife Flavia had been accessed illegally almost 130 times over the past year.
Prosecutors said at least 18 other people ranging from top politicians to showbusiness and sports figures had been snooped on in the same way.
The list included President Giorgio Napolitano, whose tax records were checked once before he became head of state earlier this year; Democratic Left chief Piero Fassino, whose party is the largest in the centre-left government; Angelo Rovati, a former top aide of Prodi who stepped down last month in a row over telecoms group Telecom Italia; popular actress Sabrina Ferilli; soccer stars Francesco Totti and Alessandro Del Piero; motorcycling ace Loris Capirossi; and Emilio Fede, a veteran TV journalist close to Berlusconi.
A total of 127 people are now under investigation - 117 employees at the tax and customs offices and 10 members of the tax police.
Some 250 police searches have been carried out across Italy on the homes and offices of those under investigation.
Members of the governing coalition have pointed the finger at the previous, Berlusconi-led centre-right government but Berlusconi dismissed the whole spy case on Friday as "completely bogus".
"Anybody with access to a computer can get hold of this kind of information," the opposition chief said.
But Fassino said the centre right bore "political responsibility" for the case and accused it of having "poisoned Italian political life".
Berlusconi's Forza Italia party responded by renewing accusations that the government was attempting to shift the spotlight away from the unpopular 2007 budget.
The 40-billion-euro deficit-cutting budget, branded atax sting by the opposition, has dented Prodi's popularity.
Forza Italia MP Paolo Romani said that "it's all a storm in a teacup, created on purpose to distract public attention from the difficulties of this weak government which has upset the entire country with a disastrous budget which puts up taxes and penalises the middle classes".
TAX OFFICE COMPUTER SYSTEM SAFE, MINISTRY SAYS.
Meanwhile, Junior Economy Minister Vincenzo Visco assured public opinion that the Finance Ministry's computer system was secure and "completely inaccessible to external sources".
"Something didn't work on the inside (of the system)," said Visco, who promised reforms to prevent any future illegal accessing of tax office records.
"The most serious thing about this case is that tax police were also involved and they normally respond to a chain of command," he added.
The case came to light after a complaint filed last month by the Treasury, which noticed that Prodi's tax records had been accessed a suspiciously large number of times, particularly in the run-up to the April general election in which the former European Commission chief narrowly beat Berlusconi.
Investigators said the illicit activities reached a peak between March 30 and April 8, when several Italian newspapers carried articles containing personal financial details of the Prodi family.
The articles focused on a gift of some 860,000 euros made by Prodi and his wife to their two children in 2003.
The money was used to buy homes for the Prodi offspring.
During the election campaign, Forza Italia used the information to attack Prodi, accusing the former European Commission chief of taking advantage of a law introduced by the centre right allowing him to avoid taxes on the gift.
The spy case follows on the heels of a massive wiretap scandal involving Telecom and its parent company, the tyre group Pirelli.
A bugging ring was uncovered last month which had gathered illicit data on politicians, businessmen and media figures as well as ordinary Italians but it is not yet known for what ends and for whom.
Prodi was again among those spied on.
Some 20 people have been arrested in the probe, including Telecom's former head of security Luciano Tavaroli; Pirelli security chief Pierguido Tezzi; the owner of a Florence-based private investigation firm Polis d'Istinto, Manuele Cipriani; and several police officers.
Cipriani had regular contact with members of Italian military intelligence service SISMI, as did Tavaroli.
The two spy cases and other alleged illicit activities attributed to SISMI have led Italian newspapers to speculate on the existence of "hidden powers" at odds with a democratically run system while several top centre-left officials including Fassino are calling for an intelligence management overhaul.
Italy's biggest daily Corriere della Sera said on Friday that "the impression is that more nasty surprises are in store".
Some papers drew parallels with the secret, subversive right-wing masonic lodge Propaganda Due (P2) which was disbanded by parliament in 1982.
