The U.S. State Department sanctions textile and apparel mogul Mohammad Yusuf Amdani Bai (Yusuf Amdani) for unethical commerce in Central America. He was named in the Department’s Corrupt and Undemocratic Actors Report for 2023 under Section 353 of the Northern Triangle Enhanced Engagement Act.

Amdani, chairman of multinational textile, apparel, and real estate firm GK Global, has ties to American brands and manufacturers.

Sanction Details

On Dec. 21, a public document submitted to Congress by the Secretary of State named foreign persons “who have knowingly undermined democratic processes or institutions, engaged in significant corruption, or obstructed investigations into such acts of corruption in Guatemala, Honduras, Nicaragua, and El Salvador,” states the report.

According to the U.S. State Department, Amdani “engaged in significant corruption by bribing Honduran Supreme Court officials to rule in favor of his business in a private lawsuit.”

Under Section 353, he will be ineligible for a visa or admission to the U.S. Any existing documentation that could grant him entry will be revoked. The business in question wasn’t named; however, GK Global owns a garment manufacturer, two yarn-spinning mills, and a textile chemicals company in the country.

Amdani and GK Global

According to yusufamdani.com/about, Amdani is a Forbes Books author and successful businessman and entrepreneur. Originally from Pakistan with roots in the textile and yarn-spinning industry, he took GK Global (formerly Grupo Karim’s) to Honduras in 1991, where he eventually became a naturalized citizen.

The expansion into Honduras, with the opening of Pride Manufacturing, marked the first foreign textile investors in the country, notes the GK website. It features vertically integrated production, including yarn, dyeing, cutting, sewing, printing, embroidery, and packaging services. Its products are delivered to customers and markets globally, including the U.S., Central America, Mexico, Pakistan, UAE, and Asia.

Its website reads: “Forever accountable for our operational footprint, we’re committed to safeguarding the environment as we work and to creating a better, more sustainable world for our communities.”

According to Sourcing Journal, the firm capitalized on the growing interest in nearshoring among fashion brands following the implementation of the Uyghur Forced Labor Prevention Act (UFLPA). In February 2023, Next Level Apparel, entered a strategic partnership with GK Global to develop garments in Central America and Mexico made with U.S. cotton.

“There are many benefits of this partnership with GK, including shorter lead times and reduced exposure to geopolitical risks,” Next Level CEO Randy Hales said. “Bringing our fabric production closer to home allows us to have complete supply chain transparency, including upstream traceability to the cotton.”

The firm has also solicited offshore investments from prominent apparel makers looking to enhance their access to the U.S. market and take advantage of the Dominican Republic-Central America Free Trade Agreement, states the Sourcing Journal.

In September 2023, Amdani released “World of Opportunity: Bringing Sustainable Business to Fragile Economies” with Forbes Books, highlighting GK Global’s rise in Honduras and how businesses can support fragile economies.

Legal Troubles

While GK Global has made tremendous strides in its ESG commitments, one former employee hasn’t seen its touted vision and values play out.

Olivia Aurora, a former Pride Manufacturing employee who worked for GK Global for 10 years, says her and other employees were wrongfully terminated in 2016 related to occupational health issues resulting from working in the facility.

“According to Honduran news outlet Contra Corriente, Aurora sued Pride Manufacturing in a labor court for reinstatement of her position along with backpay and benefits, winning not once, but twice, after the company appealed the decision in 2020,” the Sourcing Journal outlines. “As of March 2022, Aurora still had not received the court-mandated compensation from GK Global despite engaging worker rights group Honduran Women’s Collective and reaching a settlement with the firm months earlier.”

In March 2021, Mexico’s regulatory health board launched an investigation into the firm after a private airplane owned by Amdani was detained on its way to Honduras. On board were employees of the firm and thousands of doses of the Sputnik V COVID-19 vaccine. According to the Russian Direct Investment Fund, which developed the vaccine, the vials were inauthentic.

According to various Honduran media groups, thousands of GK Global workers in Campeche, Mexico, had already received doses of a supposed Sputnik V vaccine. No information was released about the doses given, but GK Global told the Associated Press the vaccine was to be given to employees and their families for free.

The Section 353 list of Corrupt and Undemocratic Actors is updated regularly by the State Department. The 2023 report listed 39 individuals, including former presidents, judges, and others who were involved in bribery, embezzlement, harassment, fraud, and more. The Department will continue to review the persons listed in the report, including additional credible information and allegations.