Nygard Arrested in Canada on U.S. Sex-Trafficking Charges

Canadian women’s clothing designer Peter Nygard was arrested in Winnipeg on U.S. charges claiming he trafficked dozens of women and underage girls for sex over 25 years.

The 79-year-old retail magnate faces racketeering, sex-trafficking and related charges in an indictment that alleges “a decades-long pattern of criminal conduct involving at least dozens of victims in the United States, the Bahamas, and Canada, among other locations.”

U.S. prosecutors claim that from 1995 to this year Nygard used company money, resources and employees to traffic dozens of women and minors to force them into sex with him and his friends. Nygard often targeted women and girls from disadvantaged backgrounds, plying them with phony promises of modeling jobs and financial support, according to the government.

“Mr. Nygard vehemently denies these allegations. All of them,” Jay Prober, Nygard’s lawyer, said in a phone interview Tuesday.

The Nygard case is the second high-profile sex-trafficking prosecution in Manhattan in recent months. In a separate case, former socialite Ghislaine Maxwell was accused this year of helping her ex-boyfriend, money manager Jeffrey Epstein, traffic in girls in a yearslong scheme that stretched from New York to Florida to the Virgin Islands. Epstein was found dead last year in a Manhattan lockup in what authorities said was a suicide. Maxwell faces a trial in New York.

Nygard, the former chairman and founder of Nygard International Partnership, appeared in court in Manitoba’s capital of Winnipeg Tuesday. Prober asked for a publication ban on the evidence in the case, but Justice Sheldon Lanchbery denied the request. The judge scheduled a hearing for Jan. 13. Nygard was ordered to remain in jail pending a bail hearing.

“We hope to go for bail next week and certainly at the first reasonable opportunity,” Prober said.

Prober said he is still reviewing the legal documents and isn’t in a position to say whether Nygard will fight extradition to the U.S. -- a potentially lengthy process in the Canadian legal system.

The retail mogul is accused in the indictment of sexually assaulting some of the victims and controlling women through surveillance and physical restraint. Nygard would sometimes trade women with his male friends and business associates for sex, using intimidation and threats to ensure they complied, prosecutors said.

Nygard’s Manhattan headquarters were raided by U.S. authorities earlier this year as part of an investigation into allegations of sexual assault, the New York Times reported in February.

The government claimed Nygard used his company to pay for sex, including hiring “girlfriends” as models and assistants. He also allegedly used company money and employees to intimidate some witnesses and to pay for false statements from others.

The Canadian businessman hosted so-called “Pamper Parties” at his properties in Marina del Rey, California, and at his home in the exclusive Lyford Cay community in the Bahamas, where guests were provided with food, drinks, and spa treatments, according to the indictment. He used employees and “girlfriends” as intermediaries to let victims know he was interested in having sex with them, paying them in cash, prosecutors said. Some unwilling participants were drugged or coerced into sex, the U.S. claims.

Born in Finland, Nygard founded Nygard International in 1967. He was also involved for more than a decade in a legal and public relations war conducted in the U.S., U.K and the Bahamas with his Lyford Cay neighbor, the hedge-fund billionaire neighbor, Louis Bacon.

In March, Nygard International Partnership defaulted on a $40 million credit line just days after the deal closed. The company failed to promptly tell lenders about allegations of rape made against the retailer’s founder, according to court papers.

The company filed for bankruptcy the same month and U.S. fashion retailer Dillard’s agreed to buy Nygard’s store inventories in June. Dillard’s has about 300 stores in the U.S.

©2020 Bloomberg L.P.

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