A clothing company that prides itself on its made-in-America label is under investigation by the U.S. Immigration and Customs Services for hiring illegal workers.
A federal investigation found that 1,600 of the 4,500 employees at American Apparel's Los Angeles factories got their jobs using "suspect and not valid" eligibility documentation, Reuters reported.
In addition, the status of another 200 workers could not be verified because of discrepancies, the January 2008 probe found.
American Apparel, in a recent federal filing, said it did not intentionally hire illegal aliens, Reuters reported.
"ICE's notification provided no indication that the company knowingly or intentionally hired unauthorized aliens and no criminal charges have been filed against the Company or any current employees," the filing said.
If the workers are unable to provide proof of eligibility, they will be forced to leave the company, American Apparel said in a statement.
The company's founder, a Canadian immigrant who attended private school in Connecticut and first ran his clothing company out of his Tufts University dorm room in Massachusetts, portrays himself, and his company, as a proponent of immigrant, gay and workers' rights.
Dov Charney told NPR in April 2006 that 75 percent of his workers are Mexican -- and the legal status of each and every one had been checked.
"Everyone who works here, we check their documents — but we don't over-document or under-document," he said in the interview. "We follow the law in a very precise manner."
He acknowledged during the interview that the apparel industry is "laced with falsely documented workers."
Charney has advocated for the legalization of foreign workers and has used the slogan, "Legalize LA" on T-shirts, in billboard ads and on banners that hang on the company's building.
One of its ads boasts that the company is committed to the highest in quality, while pioneering industry standards of social responsibility in the workforce.
American Apparel has touted its "sweatshop-free" operation and says it pays some of the highest wages in the industry.
"The company remains very proud of its track record as an advocate for the comprehensive reform of the country's immigration laws," Charney said in a statement.
On his personal Web site, Charney says that North America should have a common currency and "that there should be a border-less environment."
This is not the first time Charney has been embroiled in controversy. He recently agreed to a $5 million settlement with filmmaker Woody Allen over the use of Allen's image in a billboard.
American Apparel depicted Allen as a Hasidic Jew with a long beard, side curls and black hat. The billboard featured Yiddish text meaning the holy rabbi.
The Associated Press contributed to this report.