Canadian police have arrested a Finnish-Canadian fashion designer in Canada, following his indictment in the U.S. for allegedly using his business as a front for "legitimacy" in order to hide sex trafficking, racketeering and other illicit activity, Business Insider reported Thursday.

Acting U.S. legal counsel Audrey Strauss said Peter Nygard had used his influence and businesses since 1995 to recruit victims in the Bahamas, Canada and the U.S. for his sexual pleasures and that of his partners.

Jay Prober, the 79-year old fashion mogul's attorney, said that Nygard vehemently denies the accusations "and he expects to be vindicated in court."

Nygard's arrest on charges of sex trafficking came after U.S. federal authorities raided his Manhattan offices earlier this year.

The raid conducted by the Federal Bureau of Investigation came soon after 10 women filed a lawsuit against Nygard, claiming he enticed underage and destitute women to his Bahamas estate with money and promises of a stable job in his fashion business.

According to plaintiffs in the lawsuit, filed in New York City, the victims were as young as 14 or 15 when Nygard drugged and raped them.

Based on the indictment, Nygard took some victims, which he called "girlfriends," to night clubs where the young women would be forced into having sex with other men.

Nygard has been the subject of an inquiry by the FBI's child exploitation task force and New York police since last year.

Nygard's fashion design company was once the biggest producer of women's clothing in Canada. Born in Finland, he grew up in Manitoba and eventually became one of the richest men in Canada.

After over half a decade at the helm of his fashion design and manufacturing empire, Nygard quit as chairperson of Nygard International in February after U.S. authorities raided his home and company headquarters in Manhattan as part of an ongoing probe into multiple claims of rape.