Business abuse scandal: Payments to former CEO suspended

American clothing company Abercrombie & Fitch suspended payments to its former CEO following allegations of sex trafficking.

Abercrombie & Fitch says it stopped providing former CEO Mike Jeffries with lifetime bonus payments of about $1 million a year on top of his standard pension in the wake of sex trafficking allegations.

In October, allegations emerged of exploiting young people recruited for sexual activity while Jeffries was boss. The BBC spoke to eight men who attended these events, which took place in London, New York and Marrakesh, among other cities, and some claimed they were exploited or abused.

In a subsequent lawsuit, Jeffries was accused of financing a sex trafficking operation.

The brand told the BBC it had suspended further pension payments to Mr Jeffries.

WHAT HAPPENED?

The BBC alleged that Mike Jeffries, former CEO of the American clothing company Abercrombie & Fitch, and his British partner Matthew Smith, exploited men for money at private sex parties they organized in different cities around the world.

In the weeks that followed, Abercrombie & Fitch (A&F) was accused in a civil lawsuit of financing a “criminal enterprise” run by Mike Jeffries and Smith between 1992 and 2014.

Court documents allege that more than 100 men may have been sexually abused during Jeffries’ time as CEO, and that the young men were manipulated under the pretext of becoming Abercrombie models.

It is also alleged that corporate money and resources were used to facilitate a “sex trafficking enterprise.”