MCM was Germany's hottest luxury brand — then a tax investigation broke it

MCM (Michael Cromer Munich) was founded in 1976 in Munich, Germany. The brand specialised in luxury leather goods and accessories, known for its ostentatious style and signature Cognac Visetos logo-printed material. By the early 1990s, MCM had become one of the most recognisable luxury brands in the world, with 250 branches globally and annual sales of $250 million in 1993. The brand was particularly popular in Asia, where its flashy aesthetic resonated with a growing luxury consumer base.

In 1995, German tax authorities launched an investigation into founder Michael Cromer for alleged tax evasion. The investigation itself was enough to destroy confidence — banks stopped lending, investors pulled support, and the company's financial structure unravelled. MCM had grown fast on debt and leverage, and when the tax probe made it a risky counterparty, there was no equity buffer to absorb the shock.

The company was restructured in 1997, with its stores and trademark rights split and sold to different buyers. The brand that had been valued at hundreds of millions was broken into pieces. By 2005, when Sungjoo Group acquired the worldwide rights, global sales had fallen to about $100 million — less than half the 1993 peak. MCM survived and was later revived under Korean ownership, but the original German luxury house was gone.