Tag Archive for investigation

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Amway Looks To Work With Authorities After Recovering From Arrest of A CEO

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Direct seller  Amway India is looking to put behind it controversies stemming from the arrest of its top leadership over allegations related to various irregularities and regain growth momentum while charting out a new phase of engagement with the government. 
Anshu Budhraja, the Rs 1,900-crore direct selling firm’s first India head in 16 years, said his immediate priority is to engage with the government constructively and take Amway forward from what he said is a “point of inflexion for the next growth phase.” 

Amway has consistently denied any wrongdoing on its part. “An Indian leader understands the sensitivities of Indian culture,” Budhraja said in an interview. “He has the benefit of growing up and being part of system. It’s very simple… the way an Indian will interact with key stakeholders will be different from what a

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FTC: Vemma Temporarily Shut Down For Running Pyramid Scheme

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AP Reports: The Federal Trade Commission said Wednesday that Vemma Nutrition has been temporarily shut down for operating a pyramid scheme that promised college students riches if they sold its nutritional drinks, but most ended up losing money.
The consumer protection agency said that Vemma told recruits that they could make as much as $50,000 per week selling its nutritional beverage Vemma, energy drink Verge or protein shake Bod-e. An initial investment of $600 was paid for products and business tools and $150 in Vemma products had to be bought each month to receive bonuses. The FTC said Vemma provided little help on how to sell its products and instead rewarded them for recruiting more people.
Vemma earned $200 million a year in 2013 and 2014, according to the FTC.
A representative from Vemma, which is based in

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How ItWorks! Drove Over $1 Billion In Sales

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Molly Mulshine from Tech Insider shares: 
I’ve started seeing promotional weight-loss posts from people I know on Facebook and Instagram.
Sandwiched between party photos and wedding announcements, the posts show stomachs, legs, and arms before and after application of “this crazy wrap” that can “tighten, tone, and firm” with “minimized appearance of cellulite” and “fast and lasting results” in “as little as 45 minutes.” Similar posts endorse “fat fighter” pills, eye cream, menopausal supplements, “greens” powder that can “detoxify, energize, and alkalize,” and “defining gel” that does wonders on wrinkles.
These people, mostly women, also tell me they’re making thousands of dollars selling this stuff.
As if that weren’t enough, they’re inviting me to join.
Many of these women are selling products for a company called It Works!
If you think their product or the business opportunity sound too good to be true, then you’re not alone. What

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Tables Turn: The FBI Is Investigating Bill Ackman And His Campaign Against Herbalife

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The FBI and federal prosecutors are interviewing people related to hedge-fund manager Bill Ackman for potential Herbalife stock manipulation, reports The Wall Street Journal.
They’ve asked for documents related to the stock. Neither Ackman nor his hedge fund, Pershing Square, have been served with a subpoena.
Ackman has been publicly shorting Herbalife since December 2012. He has said that the multilevel-marketing nutrition firm is a pyramid scheme and that his hedge fund, Pershing Square, is shorting its stock to zero.
Here’s The Journal on exactly what investigators are trying to figure out in this case:
Prosecutors in the Manhattan U.S. attorney’s office and New York field office of the FBI have conducted interviews and sent document requests in recent months in connection with the investigation, which is looking into whether people, including some hired by Mr. Ackman,

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Law Firm Investigating Potential Claims On Behalf of Medifast, Inc. Stockholders

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Kirby McInerney LLP is investigating potential claims against the Board of Directors of Medifast, Inc. (“Medifast” or the “Company”) MED, -0.36% concerning the improper compensation of the Company’s executives.
Medifast’s key executive compensation increased drastically from approximately $2.12 million in 2012 to approximately $12.11 million in 2013. This is an especially significant increase given the fact that key executive compensation was under $2 million for each year from 2009 to 2011. While the key executive compensation has increased dramatically, there has not been any significant increase in the Company’s stock price.
If you are a Medifast stockholder and wish to obtain additional information, please contact J. Brandon Walker, Esq. by email at bwalker@kmllp.com, or telephone at (212) 699-1145, Melissa Fortunato, Esq. by email at mfortunato@kmllp.com, or telephone at (212) 699-1141, or toll free at (888) 529-4787, or by filling out this contact form. There is no cost or obligation to you.
Kirby McInerney LLP is a New York-based law firm concentrating in securities, whistleblower, antitrust and consumer litigation.

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Avon Under Investigation

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Zamansky LLC announces that it has commenced an investigation of Avon Product Inc.’s (AVP) employee personal savings account plan (the “Plan”) for potential violations of the federal Employee Retirement Income Security Act (“ERISA”).
ERISA imposes fiduciary duties to prudently manage and invest plan assets. These duties were allegedly violated by Avon Products’ continued offering of its company stock during a pending federal investigation for violations of the Foreign Corrupt Practices Act (“FCPA”).
Since 2010, Avon’s stock price has fallen from over $40 per share to below $10 per year. Avon’s collapse in stock price relates to the FCPA investigation by the U.S. Department of Justice and Securities and Exchange Commission. The FCPA makes it illegal for U.S.-companies operating in foreign countries to pay bribes or kickbacks.
Separate shareholder lawsuits have alleged that Avon engaged in systemic FCPA violations, and misrepresented its revenues from various foreign countries. One lawsuit also alleges that Avon made numerous misrepresentations about the extent, reach and costs of the investigations against the company.
According to employee stock and investment fraud attorney, Jake Zamansky, Avon Products’ employees who purchased and held company stock (AVP) through the Plan since 2010 have suffered substantial losses to their retirement savings. The FCPA

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Herbalife Will Be Exonerated After FTC Probe

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Herbalife Ltd. (HLF), the nutrition-product maker facing allegations that it runs a pyramid scheme, expects to be cleared of wrongdoing when regulators complete an investigation of the company.

“We anticipate at the end of the day we will be exonerated,” Chief Financial Officer John Desimone said in an interview. “We will wait to say anything more until the investigation is complete.”

The U.S. Federal Trade Commission is probing the Los Angeles-based maker of weight-loss shakes and nutritional supplements following accusations by billionaire hedge-fund manager Bill Ackmanthat the company misleads distributors, misrepresents sales figures and sells a commodity product at inflated prices. The Federal Bureau of Investigation also opened an investigation and several states are looking into complaints.
“We will respect the integrity of the investigations,” Desimone said. “We will fully cooperate and we have complete faith in our members and our business model.”
With a $1 billion bet against Herbalife, Ackman’s Pershing Square Capital Management LP is trying to profit from a drop in the shares. He’s been campaigning to shut down the company since December 2012, saying it exploits distributors rather than selling products to consumers.
Looking Glass
Ackman’s latest salvo came yesterday. Christine Richard, a Pershing-hired researcher who first brought Herbalife to Ackman’s attention, posted

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Aspire Worldwide Under Investigation

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Mobile payments and loyalty scheme Aspire Worldwide (AU) Pty Ltd is the subject of an Australian Competition and Consumer Commission investigation into whether the scheme complies with Australian Consumer Law, news.com.au understands.
Aspire is a cashback shopping scheme, where customers (known as franchisees) are asked to pay a joining fee, with the promise they’ll earn a ‘passive income’ once they get small businesses to also sign onto the scheme.
The joining fees range from $3000, to $22,000 as a “coach mentor franchisee”.
One of its founders, UK-based motivational speaker Andy Hansen, was involved in the early promotion in 2011 of the Lyoness cashback scheme in Australia, which iscurrently being sued by the ACCC over allegedly operating a pyramid scheme and engaging in referral selling.
Lyoness denies any wrongdoing and says it will “vigorously defend” the action. A directions hearing was held last month and the matter will resume in February next year.
In defence documents filed with the Federal Court this week, Lyoness distanced itself from Mr Hansen and his associates, Wendy Hansen, Phil Watts and Sally Watts — who referred to themselves as “Global Go Getters” in online training webinars — claiming they were neither employed by Lyoness nor acting on its behalf at the time.
WATCH: LYONESS TORN APART ON

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TelexFree Hearing Next Week

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A hearing will be held in Boston next Tuesday to determine whether an Ashland man accused of running an international pyramid scheme can access $4 million of his money to help fund his defense.
TelexFREE co-owner James Merrill initially asked the U.S. District Court two weeks ago to release the funds, which he said are necessary to cover the exorbitant cost of defending himself against a charge of conspiracy to commit wire fraud.
But government prosecutors have resisted, telling the court Merrill has not shown the money didn’t come from TelexFREE, which several state and federal agencies have charged with being a pyramid scheme.
The hearing will be held before Magistrate Judge David H. Hennessy at 9:30 a.m., according to court records.
 
TelexFREE was ordered to shut down last summer in Brazil, after a judge ruled it a “financial pyramid” scheme, according to news reports.
Galvin’s complaint says the company has raised over $1 billion worldwide, “often from honest earnings and savings accounts of Brazilian-Americans and other minorities.’’
The scheme works by constantly bringing in new money, the state alleged. For instance, participants are recruited to invest either $289 or $1,375, and receive a number of advertising kits in return. By posting ads on web sites

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TelexFree Inches Closer To Chapter 7

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Yesterday saw a hearing for TelexFree Trustee Stephen Darr’s request for permission to subpoena several companies associated with TelexFree. Darr had also requested permission to conduct depositions with individuals from said companies, with the court granting him permission to proceed.
Five such motions were filed by Darr, with three of them granted as proposed. Alvares and Marsal (financial consultants to TelexFree) objected only to having to share emails between the firm and its legal counsel.
Darr agreed to this on condition that he reserves the right to request the emails, if needed, at a later date. A & M consented on condition they retain the right to appeal any such requests.
At the time of publication, no order has been made public regarding Darr’s request to subpoena TelexFree’s law firm Greenberg Traurig, however news reports suggest permission was granted on all five subpoena requests.
Speaking to the Worcester Telegram about why he had to file the requests, Darr remarked
There are no employees left. There’s no insurance. There never was insurance.
I have no money to start up the business. I just don’t know if there ever was a business. I’m hampered by a lack of records.
Following a raid on TelexFree’s headquarters, HSI and FBI agents seized a host of TelexFree’s onsite

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