Former Abercrombie CEO's partner pleads not guilty to sex trafficking charges, is freed on bond

CENTRAL ISLIP, N.Y. (AP) — Matthew Smith, the partner of former Abercrombie & Fitch CEO Mike Jeffries, was released on $10 million bond Tuesday in their sex trafficking case with conditions including home detention and GPS monitoring.

Smith, 61, pleaded not guilty to sex trafficking and prostitution charges in a federal court on New York's Long Island.

Smith was arrested Oct. 22 along with Jeffries and a third man, James Jacobson, on charges of luring men into drug-fueled sex parties by dangling the promise of modeling jobs with the trend-setting retailer.

Prosecutors said in court papers that the men were induced by “force, fraud and coercion” to engage in sex parties between 2008 and 2015 in which they were sometimes directed to wear costumes and endure painful erection-inducing injections.

Jeffries and Jacobson have pleaded not guilty and were previously released on bond. But Smith, a dual U.S.- British citizen, was initially detained after prosecutors raised concerns that he might flee the country.

Under the terms of the bail agreement, Smith will turn over his passport and he and Jeffries will be limited to $125,000 in monthly withdrawals from a trust set up for their benefit.

Smith's attorney, Joseph Nascimento, said his client is happy that prosecutors agreed to bail conditions “that will allow Mr. Smith to respond to these allegations in court while on home confinement.”

Jeffries took over as CEO of Abercrombie in 1992 and led the company's transformation into a mainstay of early 2000s teen culture.

Jeffries left Abercrombie in 2014, and the Ohio-based company said in a statement posted on Instagram that it was “appalled and disgusted” by the allegations against him.