Massachusetts Senator calls for probe into Herbalife, shares drop

[Eugene]

Source: Reuters

Massachusetts Senator calls for probe into Herbalife, shares drop

BY SVEA HERBST-BAYLISS
BOSTON Thu Jan 23, 2014 12:58pm EST

(Reuters) - Massachusetts Senator Edward Markey is asking for more information about the business practices of Herbalife Ltd, his office said on Thursday, making him the most prominent lawmaker to call for an investigation into claims the nutrition company is running a pyramid scheme.

Herbalife shares tumbled more than 12 percent after Markey, a Democrat, said he had written to the U.S. Securities and Exchange Commission (SEC), the Federal Trade Commission (FTC) and to Herbalife itself to try to obtain more information.

"There is nothing nutritional about possible pyramid schemes that promise financial benefit but result in economic ruin for vulnerable families," Markey, a member of the Commerce, Science and Transportation Committee, said in a press release. He said the call for a probe followed "serious complaints of improper pressure and financial hardship" from constituents.

Herbalife spokeswoman Barbara Henderson said the company had received the letter and looks "forward to an opportunity to introduce the company to him and address his concerns at his earliest convenience."

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Read more: http://www.reuters.com/article/2014/01/23/us-herbalife-investigation-idUSBREA0M19520140123

[siligut]

1. Only after Ackman has been accusing them for over a year and China is investigating Nu Skin

Last edited Sat Jan 25, 2014, 12:00 AM - Edit history (1)

http://www.reuters.com/article/2014/01/16/us-china-idUSBREA0F0TB20140116

(Reuters) - China's regulators launched probes into skincare products maker Nu Skin Enterprises Inc after local media questioned the U.S. company's business practices, dragging down shares of several retailers that use similar distribution models.

Nu Skin shares shed a third of their market value by Thursday afternoon. Shares of nutritional supplements maker Herbalife Ltd fell 10 percent, while those of USANA Health Sciences were down 12 percent.

Earlier Thursday, the Xinhua news agency said the State Administration for Industry and Commerce (SAIC) ordered local authorities to investigate a report in Communist Party mouthpiece, the People's Daily, alleging Nu Skin had been exaggerating its influence and creditworthiness in brochures and organizing "brainwashing" gatherings.

MLM schemes are the Mormon business model and if you want a good, depressing laugh, go read the Yahoo Message Board for HLF http://finance.yahoo.com/mb/HLF/