Ex-Abercrombie & Fitch CEO was involved in sex trafficking for 6 years while he was at the company's helm, prosecutors say

• Former Abercrombie & Fitch CEO Mike Jeffries has been arrested.
• Jeffries, his partner, and a third man face charges of sex trafficking.
• The three are accused of using the power of the brand to coerce men into '"sex events."

Former Abercrombie & Fitch CEO Mike Jeffries, his partner, and a third man have been arrested on federal sex-trafficking charges that allege they used the power of the brand to coerce dozens of men to participate in "sex events" across the US and abroad.

Jeffries and his partner, Matthew Smith, were arrested in Florida as part of an investigation led by the Brooklyn US Attorney's Office. Both are expected to appear in federal court in West Palm Beach on Tuesday.

James Jacobson, who prosecutors say was personally employed by Jeffries and Smith, was arrested in Wisconsin and is scheduled to make his initial appearance in federal court in St. Paul, Minnesota.

Federal prosecutors allege in a newly-unsealed indictment that Jeffries, Smith, and Jacobson operated an international sex trafficking and prostitution business. Jeffries stepped down as Abercrombie & Fitch CEO in 2014 after more than two decades at the helm of the fashion giant. Prosecutors say the alleged sex trafficking operation spanned from about 2008 to 2015.

The three exploited their victims, many of whom hoped to become Abercrombie & Fitch models, "by using the so-called casting couch system," said Brion Peace, the US attorney in Brooklyn.

"This case should serve as a warning: prepare to trade that couch for a bed in federal prison," Peace said at a noon press conference.

Federal prosecutors will seek a "substantial" amount of bail for Jeffries and Jacobson, and want Smith to be detained without bail given the risk of flight from his dual UK-US citizenship, Peace said.

The 12-page indictment charges the men with sex trafficking and 15 counts of interstate prostitution.

Brian Bieber, Jeffries' attorney, and an attorney representing Smith, told Business Insider in two statements: "We will respond in detail to the allegations after the indictment is unsealed, and when appropriate, but plan to do so in the courthouse."

Attorneys for Jacobson did not immediately respond to requests for comment. Abercrombie & Fitch declined to comment to BI.

Jeffries and Smith "relied on their vast financial resources," Jeffries' power as Abercrombie & Fitch CEO, and a network of people, including Jacobson, "to run a business that was dedicated to fulfilling their sexual desires and ensuring that their international sex trafficking and prostitution business was kept secret, thereby maintaining Jeffries' powerful reputation," the indictment says.

As part of the operation, prosecutors say Jeffries and Smith paid for dozens of men to travel to meet the two at their New York homes and at international hotels in places like England, France and Italy for the purpose of engaging in commercial sex acts with the men.

Prosecutors allege that Jacobson traveled throughout the US and across the globe to recruit and interview men for so-called "sex events."

"During 'tryouts' of potential candidates, Jacobson typically required that the candidates first engage in commercial sex acts with him," the indictment says.

Prosecutors said in the indictment that Jeffries, Smith, and Jacobson caused men to believe attending the sex events "could yield modeling opportunities with Abercrombie or otherwise benefit their careers, or, in the alternative, that not complying with requests for certain acts during the Sex Events could harm their careers."

Peace also said his office believes "dozens and dozen of men" were victimized between 1992 and 2015 beyond the 15 John Does in the indictment.

A BBC investigation published last year first reported that Jeffries and Smith were involved in a network that found young men and recruited them for sex.

On Tuesday, Peace credited "the bravery of the victims" for finally coming forward a decade or more after the acts in the indictment.

"Once that happened, our team and our law enforcement partners investigated this case thoroughly and quickly," he said.

Peace was also asked about the close timing of the Jeffries and Sean "Diddy" Combs sex-trafficking cases. Combs was indicted last month on similar allegations of using his wealth and power for more than a decade to sexually exploit multiple victims.

"I don't know if I could say it's a trend, one way or another," he said. "I'm hopeful that to the extent there are victims out there who have been subjected to trafficking activity, abuse, exploitation, that they would be confident enough in their federal and state law enforcement partners to come forward."

Peace said anyone with information about the case, including victims, can contact the FBI at 1-800-CALLFBI or Tips@FBI.gov.

"We prosecuted R. Kelly, we brought the NXIVM case," Peace said. "We don't hesitate to hold the powerful and the wealthy to account if they have violated federal criminal law."