Brunello Cucinelli questioned by Italian regulator over short seller claims
Consob seeks assurances that luxury brand did not mislead market over its Russian operations
Italy’s financial regulator is scrutinising whether Brunello Cucinelli misled investors over its operations in Russia, after a short seller published detailed allegations that wiped more than €1bn off the luxury group’s market value on Thursday.
Consob wrote to the company seeking clarity over comments made to the Financial Times last weekend by Cucinelli chief executive Luca Lisandroni, in the wake of a report by London-based Morpheus Research, according to people familiar with the exchanges.
Lisandroni told the FT that Cucinelli’s stores in Russia were closed and that any goods it sold in the country were in compliance with EU sanctions.
But London-based Morpheus alleged on Thursday that Cucinelli’s stores in Russia remained open and that they were selling products at values well in excess of the legally permitted amount.
In 2022, the EU banned exports of luxury goods worth more than €300 to Russia. Morpheus has taken a short position in Cucinelli shares, which fell 17 per cent on Thursday.
Consob’s scrutiny does not amount to a formal investigation and comprises a normal part of the regulator’s oversight process when a stock fluctuates sharply on a single day, for reasons unrelated to broader market conditions, the people said. Consob declined to comment.
Lisandroni told the FT last week that while its stores in Russia were closed, the brand was offering “one-on-one sales” in its showroom in the country.
He said sales were limited to goods that either fell below the €300 export threshold or those that were imported into Russia before sanctions came into effect.
However, Morpheus claimed that undercover shoppers saw items priced at the equivalent of more than €1,000 in Cucinelli’s Russia stores in August and September, and that they were labelled as having been manufactured in Italy in either 2024 or 2025.
People close to Cucinelli said the goods cited in the report complied with sanctions because they had been imported before 2022 and were retagged this year.
The allegations are potentially damaging for Cucinelli, whose namesake founder, Brunello Cucinelli, extols the virtues of “humanistic capitalism”.
Analysts at Bernstein said in a note on Friday that Cucinelli “needs to start damage limitation asap to protect its reputation with customers and investors alike”.
While noting that supply chain scandals at Dior and Loro Piana had apparently had little to no impact on sales, the analysts said that because Cucinelli prided itself on selling “ethical and sustainable” luxury, it could face a more pronounced backlash from customers.