Italian fashion influencer Chiara Ferragni fined nearly $2 million for misleading Christmas cake ad

Italian fashion influencer Chiara Ferragni.
Italian fashion influencer Chiara Ferragni. Photo credit: Getty Images / Jacopo Raule.

By Reuters

Companies controlled by top Italian fashion influencer Chiara Ferragni must pay a fine of 1.075 million euros (NZ $1.89m) for misleading customers over charity donations linked to sales of a Christmas cake, Italy's antitrust authority (AGCM) said on Saturday.

AGCM also fined Italian cake maker Balocco €420,000 (NZ $738k).

The penalties stem from a probe the regulator announced in June, related to a Ferragni-branded Balocco pandoro - a Christmas alternative to panettone - sold in Italy late last year, at over 9 euros each, compared to under 4 euros for a regular Balocco pandoro.

AGCM said advertising and higher pricing misled consumers to think that by buying the cake, they were directly contributing to a charity for bone cancer research at a hospital in Turin, and also that Ferragni was herself making donations.

Balocco had made a 50,000 euro one-off payment to the hospital months before launching the Ferragni pandoro, so sales of the product had no effect on charity donations, the regulator said.

It added that the Ferragni-related companies it sanctioned gave no money to the Turin hospital, despite receiving more than 1 million euros for the branding initiative and for related promotional activities.

Ferragni, 36, is one of the world's most famous fashion influencers, with nearly 30 million followers on Instagram.

In a social media message, she said the partnership with Balocco was "a commercial deal" done in complete good faith, and in which the hospital donation made by the cake maker was a key point of the agreement.

Saying she was sorry that someone could have misunderstood her advertising, Ferragni said she would appeal the AGCM fine, calling it "unjust".

Balocco, in a statement sent to Italian media, said it also disagreed with the fine and reserved the right to take action to defend itself.