Two years, 27 brands: what investigators have actually found in the “Made in Italy” supply chain

Two years ago, Italian prosecutors uncovered worker exploitation at factories that, according to investigators, supplied luxury brands. The investigation exposed cracks in the “Made in Italy” supply chain, undermining the label’s long-standing association with quality and ethics, and calling into question the belief that exploitation is a problem confined to fast fashion.

The first wave named five brands whose lower-tier suppliers were accused of exploitation: Dior, Giorgio Armani, Loro Piana, Valentino and the Italian mass-market label Alviero Martini. Those cases have since been closed, the court finding that the necessary changes had been made. But prosecutors did not stop there: over the intervening years the investigation has widened to a further 22 brands.

The latest wave, announced last week, includes Chanel, Moncler, Bvlgari and Brunello Cucinelli. None of these brands has been placed under judicial administration or accused directly — prosecutors have only requested corporate governance documents for investigations into subcontractors. Every label that responded to a request for comment said it was cooperating with the investigation and had mechanisms in place to detect unethical practices.

Prosecutors began with the most serious charges, drawing on Italy’s anti-mafia code — the national legal framework for tackling organised crime. In most cases, court documents recorded evidence of forced labour and of surplus orders being passed to Chinese-owned factories where working conditions were exploitative and health and safety rules and labour law were breached. Brands moved quickly to distance themselves from those named and tightened their supply chain controls.

A second phase in December 2025 named a further 13 brands linked to the suppliers Bag Group, Effellemoda and New Leather: Prada, Gucci, Versace, Dolce & Gabbana, Missoni, Ferragamo, Saint Laurent, Givenchy, Pinko, Coccinelle, the Italian subsidiary of Alexander McQueen, the Italian operating company of Off-White and Adidas. The allegations again centred above all on the exploitation of workers — most of them Chinese or of Chinese descent. The investigation is continuing.

Adidas insists it is not under direct investigation: “Adidas is not a subject of the investigation. Neither we nor our Italian suppliers have business relationships with the company under investigation. We are cooperating fully with the Italian authorities.” Coccinelle said it had immediately begun gathering the documents requested and reaffirmed its “unwavering commitment to compliance with the law and with the highest ethical standards”.

Every case rested on the presumption that the brands did not know what was happening: production went to subcontractors beyond their line of sight. One allegation broke that pattern. In October 2025, prosecutor Paolo Storari sought a six-month advertising ban on Tod’s, arguing that the company had knowingly profited from illegal subcontractors making “enormous profits by exploiting severely underpaid Chinese workers”. Three senior executives were investigated alongside the company under corporate liability law. In February the hearing was adjourned: if Tod’s demonstrates sufficient progress, the request for a ban may be withdrawn. The company denied the allegations.

The latest wave concerns subcontractors producing luxury packaging — garment covers, dust bags, branded carriers and pouches. Inspections at the Milan operation of Moda Fashion Styles and at the subcontractor Isacco in Varese identified further workers of Chinese descent in exploitative conditions.

Official documents show that Moda Fashion Styles employed undeclared workers without residence permits; that machines lacked the required safety systems; that workers were housed in degrading conditions; that electricity consumption data pointed to production running around the clock, including on public holidays; and that labels reading “Made in Albania” were found on the premises. The company has no direct relationships with the brands, but investigators found evidence that their products were made there. Prosecutors also discovered invoices for that work issued by the company Brandart — which does have direct relationships with Owenscorp Italia (a Rick Owens entity), Chanel, Brunello Cucinelli, Goyard Italie and Moncler.

Brandart said it had been asked to assist the authorities by providing information and supporting documents on its monitoring of a number of suppliers, and that this “confirms its unwavering commitment to the control and oversight of the supply chain in line with the highest compliance standards”.

Behind all this lie systemic causes. The process began as pressure mounted on Italian companies in connection with new EU regulations on traceability and due diligence in supply chains. Fashion was an obvious place to start: a key export with one of the most complex and opaque supply chains there is.

The first problem is subcontracting, where orders pass to smaller operators that brands and auditors scrutinise less closely. Regulatory pressure has pushed some brands to shrink their supplier base and tighten oversight, but many still have no such oversight at all.

The second is forced labour, which in Italy is particularly complicated. Prosecutors targeted so-called caporalato — a system of labour gangmasters — says Andrea Sianesi, professor of operations and supply chain management at the Politecnico di Milano, who sat on a working group convened by the prosecutor’s office. The system has a long history of hiring undocumented people, withholding part of their wages and keeping them in exploitative conditions. Illegal migrants are especially vulnerable, adds UCL lecturer Roya Derakhshan.

In Italian supply chains the conversation most often turns to Chinese migrants, many of whom work at Chinese-owned factories across Italy — known as “Chinitalian”. The phenomenon emerged in the late twentieth century: globalisation opened access to cheap labour and to larger industrial operations that worked faster and more cheaply than local ones. At the same time, many Italian factory owners realised that their children did not want to continue the family business — and an influx of Chinese entrepreneurs willing to buy a going concern looked like a mutual benefit, explains Hakan Karaosman, associate professor at the Politecnico di Milano. The factories brought in Chinese workers to keep orders flowing; some were undocumented or working under coercion, which created deep rifts in local communities. Some of these factories comply with the law, some circumvent it — which is what the investigation exposed. At every stage of the inquiry, “Chinitalian” factories have played a prominent role.