Herbalife Ltd. HLF has hired a former U.S. regulator to lead its compliance team, after the Federal Trade Commission opened an investigation into the embattled nutritional-supplement company in March.
Pamela Jones Harbour —who worked as an FTC commissioner from 2003 to 2010 and as a prosecutor for the New York State Attorney General’s office for 12 years—has been appointed senior vice president of global member compliance and privacy. She will lead a compliance team across 91 markets in the newly created role, Herbalife said Monday.
Ms. Harbour’s appointment comes as activist investors continue to face off over the company.
Herbalife, which sells weight-loss shakes and fitness supplements, has been pummeled by hedge fund manager William Ackman since December 2012, when he spent more than three hours in a Manhattan auditorium laying out his case for why he thinks the direct marketer is a pyramid scheme whose salespeople rely more on signing up new recruits than selling product. Mr. Ackman has repeatedly called for an FTC investigation into the company, and his firm, Pershing Square Capital Management, has bet about $1 billion that the company’s shares will fall.
The company has repeatedly defended its operations and has won the support of a number of Mr. Ackman’s hedge fund rivals, including Carl
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Herbalife To Tour Asia
by Tina Williams • • 0 Comments
Herbalife, a global nutrition company, has announced the launch of its second Asia-Pacific Wellness Tour, which will see six of its Herbalife Nutrition Advisory Board (NAB) members and experts visit a total of 25 cities in Australia, Cambodia, Hong Kong, India, Indonesia, Japan, Korea, Macau, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand and Vietnam.
Building on the success of the inaugural Asia-Pacific Wellness Tour held in April this year, which recorded an attendance of 22,000 across the region, this October edition of the Tour seeks to further amplify public awareness of the importance of balanced nutrition and healthy lifestyles in an increasingly time-strapped world.
“The trends of rising obesity rates, ageing population and mounting health consciousness are not showing signs of slowing down. With the return of the Asia-Pacific Wellness Tour, Herbalife seeks to highlight the impact of these issues, and impart practical, balanced nutrition tips and positive lifestyle habits to help people live healthier lives in today’s busy world. The visiting NAB members and experts will also conduct training for our Independent Herbalife Members, equipping them with nutrition knowledge to better serve their customers,” said William M. Rahn, Senior Vice President and Managing Director, Herbalife Asia Pacific.
According to the World Health Organization
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SEC Sends Accusations Of Herbalife Insider Trading
by Tina Williams • • 0 Comments
The hedge fund world occasionally crosses a legal line when gleaning information from corporate insiders. Now, a federal investigation into Herbalife and the traders who traffic in the company’s stock reveals that hedge funds themselves produce insider secrets.
Stretching the boundaries of insider trading law, the Securities and Exchange Commission on Tuesday accused two men of possessing confidential information about a hedge fund’s plan to bet against Herbalife. One of the men, Filip Szymik, settled the case; his friend and co-defendant, Jordan Peixoto, did not.
Mr. Szymik’s problems, first detailed in a New York Times article in May, began when he learned that the billionaire William A. Ackman was planning to announce a bearish view of Herbalife, a giant diet supplements company. Mr. Szymik had an unlikely source: his roommate was a junior employee at Mr. Ackman’s hedge fund. The roommate, who did not himself trade in Herbalife, is not accused of any wrongdoing.
The S.E.C. pursued Mr. Szymik, a 29-year-old former collegiate tennis star, even though he did not trade either. Instead, according to the S.E.C., Mr. Szymik shared the insight with another friend, Mr. Peixoto, who placed his own wager against Herbalife. When Mr. Ackman announced a $1 billion bet against Herbalife, a move
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Home Party Companies Are Making Waves In The U.S.
by Tina Williams • • 0 Comments
Helaine Olen, contributing editor at Pacific Standard and author of Pound Foolish talks about how home party companies are making waves, specifically in Silicon Valley:
The invitations began arriving shortly after I moved back to my native New York City in 2012. They all sounded eerily similar. Each offered a chance to spend some fun, quality time in an intimate setting with a few fellow moms—or “the girls”—while some sort of product, usually but not always clothing, was “shared.”
One of them beckoned me to a “trunk show” of jewelry and accessories by the company Stella & Dot, to be held at an Upper West Side brownstone. Another offered “a chance to share girlfriend time, refreshments and shop [sic]” for garments bearing the Ruby Ribbon label, a clothing and undergarment line.
A little Googling confirmed my suspicion: Like Amway and Mary Kay, these newer companies are multi-level marketing programs. Which is to say they offer their salespeople two ways to make money: by selling products directly to friends and neighbors, and—far more efficiently—by selling friends and neighbors on the idea of becoming salespeople themselves, and collecting a commission on their recruits’ earnings.
Suffice it to say, this was not exactly what I expected from a
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Another Wall Street Principal Shows Support For Herbalife
by Tina Williams • • 0 Comments
Kyle Bass, founder and principal of Hayman Capital Management, says he believes Herbalife is not a ponzi scheme and is a legitimate business model on an interview with CNBC. He even goes as far as saying they’ve had one of their own traders sign up with Herbalife to gain an understanding of the model to make sure it’s legitimate.
Bass became well-known after successfully predicting and benefitting from the subprime mortgage crisis by purchasing credit default swaps on subprime securities issued by various investment banks (similar to shorting the bonds).
Bass has since continued to attract media attention for his prediction of the European sovereign-debt crisis and his expectations regarding the economic future of Japan and Argentina.
Bass reminded CNBC viewers that Ackman originally went long on Pre-Paid Legal stocks (now a privately held company called Legal Shield) and shared his views on it not beign a pyramid scheme, nearly an identical explanation to why he thinks Herbalife is a pyramid scheme and is shorting that stock instead.
How long Ackman will continue to battle the Herbalife stock remains to be seen as he placed a hefty $1 Billion dollar short on the company about a year ago. The Herbalife/Ackman battle has become one of the most talked about
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Herbalife Plans To Expand It’s Partnership With Youth Soccer Organization
by Tina Williams • • 0 Comments
Herbalife Ltd. (HLF) proposed a plan to launch a new, healthy-living nutrition program “Fit from the Sidelines” in collaboration with the American Youth Soccer Organization (AYSO).
The plan intends to outline, educate, and instruct families about the significance of living an active and healthy life. Last week, the company announced it plans to launch the nutrition program in Canada.
The program extends Herbalife’s six-year partnership with the soccer organization. The partnership with AYSO is another step to target the younger lot of individuals. The leading global nutrition firm has been investing a lot lately in product innovation and relationship-building with the community.
Amid all the havoc created due to allegations put forward surrounding the company’s business model, where Bill Ackman blames the company for practicing pyramid schemes, this partnership indicates that the management is determined to keep growing bigger and is not fretting about any activist investors trying to defame the company.
The new program will be offering physical activities and simple exercises to parents who attend their children’s soccer practices and games. Parents can benefit from the program by learning about new activities and indulging in exercises they can do easily from the sidelines as they attend their children’s games.
Former
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DSA Responds To Avon Withdrawal, Speculation From Politico
by Tina Williams • • 0 Comments
Politico has speculated that the reason for Avon withdrawing from the DSA is due to the Herbalife/Ackman battle:
The cosmetics company Avon has withdrawn from the Direct Selling Association trade group, making some thinly veiled, indirect references to the Herbalife fight unfolding in Washington, D.C., and beyond.
“We believe the association’s agenda in the U.S. is overly focused on the issues of a few specific brands rather than industry-wide challenges,” the company said in a letter to other members explaining its departure. “We believe that the U.S. DSA Code of Ethics requires updating to better reflect the current state of the industry in the U.S. … As the U.S. DSA is currently operating, we do not believe that either of these issues will be addressed.”
The nutritional supplements company Herbalife has been embroiled in a fight with hedge funder and billionaire William Ackman over the company’s business practices. Ackman and his firmPershing Square Capital have made a massive short bet that Herbalife will fail — and have been working regulators to investigate the company’s business practices.
The DSA — of which Herbalife is a major member — has recently embarked on a major public affairs and PR campaign in support of the direct-selling industry. That push happened to coincide with Herbalife’s
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Herbalife Launches New Herbalife24
by Tina Williams • • 0 Comments
Herbalife (NYSE: HLF), a leading global nutrition company, announced today the launch of its new Herbalife24 website, Herbalife24.com, and a digital media campaign focused on the important role nutrition plays in an athlete’s performance while training and competing.
Herbalife24 fuels athletes 24-hours a day by providing them with the nutritional support to train, recover and perform. The seven-product line is customizable, allowing athletes to determine their day-to-day needs based on activity levels and training demands.
On Herbalife24.com, Herbalife-sponsored athletes are featured as they explain the vital role Herbalife24 products play in their athletic routines. This includes professionals such as surferGabriel Villaran and triathlete Heather Jackson, both of whom use Herbalife24 to nourish their bodies and stay at peak performance levels.
At Herbalife24.com, users and fans can engage with a host of exclusive video content, learn more about the products through interactive tools and gain insights into how to improve their own performance through videos, photos and articles.
“We are proud to introduce this new and expanded Herbalife24 campaign, which will allow us to provide even more support and resources to the thousands of athletes that choose our products and make it part of their training regimen,” said Brian McKinley, vice president of sports marketing, Herbalife. “Maintaining a healthy and balanced lifestyle
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Herbalife About To Settle Class-Action Lawsuit
by Tina Williams • • 0 Comments
Herbalife is close to reaching a settlement with five former distributors who claim the controversial nutritional products company is running a pyramid scheme that has victimized thousands.
Lawyers for both sides told California federal judge Beverly O’Connell last month that “the parties have tentatively agreed on the principal terms of a settlement,” according to court papers.
The parties asked for an extension of several pretrial filing dates, saying they needed more time to finalize a deal.
The suit was brought by California resident Dana Bostick in April 2013, less than four months after hedge fund activist Bill Ackman called Herbalife a fraud and placed a $1 billion short bet on the shares.
In June, four new plaintiffs joined the proposed class-action suit against the Los Angeles company.
Both sides declined to comment on the talks or the amount of the potential settlement under discussion.
Herbalife, which is under investigation by the Federal Trade Commission and other regulators, has denied the allegations and earlier said the suit had no merit.
But it now appears willing to accept a class-wide settlement to put a cap on its liability, sources told The Post.
The class would cover about 1.5 million people — those who joined in the US after 2009 to the present, excluding
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Herbalife’s Expansion Into Canada
by Tina Williams • • 0 Comments
Herbalife Ltd. (HLF) announced yesterday that it will launch its performance nutrition line, Herbalife24™, in Canada. The comprehensive nutrition package is designed to cater to the daily nutrition needs of athletes. The company has also partnered with the non-profit organization, Common Threads, to target younger age groups in the US as well.
The company’s increased focus on product innovation and relationship building efforts with its target market shows it will continue to expand its operations in the future, disregarding any accusations of it being a pyramid scheme. Products targeted at athletes might turn out to be a significant growth driver for Herbalife in the future.
Herbalife24 is a comprehensive performance-nutrition package, which consists of five products that let consumers modify their nutrition plan to meet their training demands and their daily nutrition needs according to the sport they play. All products in the package have been certified by the Public Health and Safety Organization, NSF International Inc.
Each product was tested to make sure that it contains no banned substances. This certification adds credibility to the products, as athletes need to be assured that the ingredients used are legal and safe. These products do not contain any sweeteners or artificial flavors.
Herbalife realized