Former Abercrombie & Fitch CEO Mike Jeffries has been arrested on sex trafficking charges, a spokesperson for federal prosecutors has said.
Matthew Smith, Jeffries' partner, and a third man, James Jacobson, have also been arrested on the same charges.
At a news conference in New York, Breon Peace, the United States attorney for the Eastern District of New York, said Jeffries, 80, used his "power, his wealth and his influence, to traffic men for his own sexual pleasure and that of his romantic partner, Matthew Smith".
Mr Peace said the indictment alleged Jeffries and Smith, 61, employed Jacobson, 71, "to act as a recruiter to find men".
Jacobson would "engage in 'tryouts' with men across the world where he would typically pay them to engage in sex acts with him".
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Smith would then decide who would meet him and Jeffries and the selected men would be flown to Jeffries' and Smith's homes or to hotels around the world "for the purpose of attending events to engage in commercial sex".
Mr Peace alleged all three defendants "used force, fraud and coercion to traffic those men for their own sexual gratification".
"They caused the men to believe that attending these sex events could yield modelling opportunities with Abercrombie or otherwise benefit their careers," Mr Peace alleged at a news conference.
"Smith and Jeffries employed a secret staff to operate these sex events. The staff ensured that the men signed non-disclosure agreements and handed over their personal items, such as their phones, before the start of the events to maintain the secrecy of these events."
James Dennehy, assistant director of the FBI's New York Field Office, said the indictment "highlights the abhorrent behaviour" of Jeffries, Smith and Jacobson.
He said the allegations are "not only beyond disturbing, dishonourable and disgraceful but simply put, it's criminal".
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Tap hereJeffries has been released on bail after paying a $10m (£7.7m) bond.
Jacobson has been released on bail after paying a $500,000 (£385,069) bond.
Smith was detained.
Jeffries and Jacobson will be arraigned on Friday at 3pm local time at the federal courthouse in Long Island.
It comes after several sexual misconduct allegations - including a lawsuit filed in New York last year accusing Abercrombie of allowing Jeffries to run a sex trafficking organisation during his 22-year tenure.
Jeffries' attorney, Brian Bieber, said in an email to the Associated Press he would "respond in detail to the allegations after the indictment is unsealed, and when appropriate, but plan to do so in the courthouse - not the media".
Lawyers for Smith did not immediately respond to requests for comment. A lawyer for Jacobson could not immediately be
reached for comment.
Lawyers for Jeffries and Smith have previously "vehemently denied" any wrongdoing.
Jeffries left Abercrombie & Fitch in 2014.
Abercrombie last year said it had hired an outside law firm to conduct an independent investigation after a report on similar allegations was aired by the BBC.
Abercrombie & Fitch has declined to comment on Jeffries' arrest.
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