A fashion executive who built the FUBU sportswear brand, has agreed to plead guilty to a charge of money laundering.

Elliot Lavigne faces up to 20 years in jail and may be ordered to give back as much as $7.7m of profits.

Federal authorities allege that Mr Lavigne earned quick profits by manipulating about two dozen initial public offerings underwritten by a defunct New York firm.

Mr Lavigne was previously chief operating officer for Donna Karan Jeanswear and chief executive officer of Jordache Enterprises, where he developed the FUBU label.

Sources say that under an agreement negotiated with federal prosecutors, Mr Lavigne is likely to be sentenced to 37 to 46 months in jail.