The American Idol judge sparked speculation he had proposed to Hussainy after she was snapped sporting a diamond band on her ring finger following an intimate Valentine's Day date with Cowell on Sunday (14Feb10).
Louis Walsh, a judge on Cowell's U.K. talent show The X Factor, proceeded to confirm the star's plans to wed, telling reporters: "I'm very, very surprised but I'm delighted he's got engaged."
However, the mogul's longtime publicist and close friend, Max Clifford, insists the reports have been exaggerated.
Clifford tells UsMagazine.com: "I spoke to Simon in London yesterday (17Feb10) afternoon, just before he took his flight back to L.A. I asked him: 'Look, are you engaged? Is it true?,' and he said, 'No! No. I'm not engaged.'
"Yes, they are an item. Yes, they're happy. But they're not engaged. That's straight from Simon's mouth."