In a shocking revelation, Italian police have uncovered supply chain abuses involving exploited Chinese workers employed in Italy by an unauthorized subcontractor, who produced handbags and accessories for the renowned Giorgio Armani fashion house. The in-house production company, GA Operations, has been accused of failing to properly monitor the situation.

Denying any wrongdoing, Giorgio Armani released a statement asserting that they have always had measures in place to minimize abuses in the supply chain. They also expressed their intention to collaborate transparently with authorities to clarify the situation.

According to the police investigation, GA Operations hired a subcontractor, which then employed unauthorized Chinese subcontractors who recruited workers under the table, including some who were illegally present in Italy. These workers allegedly faced disregarded health and safety regulations, as well as violations of working hour regulations and days off. The entire operation was consistent with the illegal practice of caporalato, a term used to describe the exploitation of workers, commonly associated with the agricultural sector.

While GA Operations is not currently under investigation, it has been placed under judicial administration for a year to ensure compliance with legal operations. However, four Chinese factory owners are facing a separate criminal investigation for their role in the supply chain abuses.

In a detailed diagram released by the police, it was revealed that the unauthorized subcontractor received a mere 93 euros ($100) for each handbag produced, while the Giorgio Armani fashion house sold the same bag for approximately 1,800 euros (around $1950). The authorized subcontractor, acting as the middleman but without actual production capabilities, was paid 250 euros per bag, pocketing a substantial 157 euros for each item, according to the police findings.

Authorities stated that this exploitative system allowed for maximizing profits by utilizing off-the-books and illegal workers, thereby significantly reducing labor costs. A video released by the Carabinieri showcased the dire working conditions in one of the factories, with overcrowded dormitories and unsanitary living conditions.

This discovery is part of a broader investigation into the fashion supply chain operating in the Milan and Bergamo provinces. Earlier this year, Alviero Martini Spa, a bag and accessory maker, was placed under judicial administration for similar reasons, highlighting the widespread nature of these exploitative practices.

As the investigation progresses, authorities are determined to bring those responsible for the supply chain abuses to justice, emphasizing the importance of enforcing ethical standards and fair treatment of workers in the fashion industry.