Business abuse scandal: Payments to former CEO stopped

US clothing company Abercrombie & Fitch has halted payments to its former CEO following sex trafficking allegations.

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

In October, allegations emerged that young people recruited for sexual activities had been exploited while Jeffries was head of the organisation. 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 had been exploited or abused.

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

The brand told the BBC it had suspended additional pension payments to Mr Jefferies.

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 in private sex parties they organized in various cities around the world.

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

Court documents allege that more than 100 men may have been sexually assaulted during Jefferies’ tenure as CEO, and that young boys were manipulated under the guise of becoming models for Abercrombie.

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