The following aricle is reproduced from Pyramid Scheme Alert:
Herbalife Is Focus
Wall Street Erupts Over Claims of MLM Fraud
After years of willful ignorance or neglect about a business sector worth $17 billion in stock value and that has solicited money from virtually every household in America, Wall Street has suddenly taken notice of multi-level marketing (MLM). One major hedge
Whatever this heated controversy brings forth, finally there is a real focus on and investigation of what previously was kept in the dark. Those who had dared to raise questions were personally vilified or sued by MLM lawyers or even harrassed by government regulators. The MLM industry is one of the largest influence-buyers and lobbyists in Washington. Ackmam stated that his position against Herbalife is "patriotic" based on the enormous harm that Herbalife does to the country and the public, especially those who are financially struggling. He has purchased a "short" position (if Herbalife's stock value goes down, he makes money) and he said he will donate all personal gains to charity.
See William Ackman's in-depth analysis of Herbalife.
|SEC Staff Reportedly Opens Investigation of Herbalife|
The business media is reporting that the staff of the U. S. Securities and Exchange Commission, the watchdog over the stock market, is opening an investigation of the multi-level marketing company, Herbalife. Hedge Fund manager, William Ackman of Pershing Squarte, publicly laid out charges against Herbalife, which may have prompted the investigation. Earlier questions, claims and complaints about deception and fraud from consumers, a Belgian court ruling that Herbalife is an illegal pyramid, two class action lawsuits against Herbalife for fraud, and the findings of other fraud investigators regarding Herbalife have been ignored by the SEC and FTC.
Among the charges made by William Ackman:
Business Media Investigating MLM
Stock analysts, business writers and television financial networks are focusing on MLM. They are going undercover to MLM recruitment meetings. They are looking at MLM payouts, interviewing distributors and asking the big question, where does MLM money come from, distributors or end-user reail buyers? Retail defines a sales company, recruiting distributors is the hallmark of an "endless chain" fraud.
Business Media have seen that MLM deception, secrecy and manipulations are bad for Wall Street. Will the mainstream media recognize the harm to Main Street?
CNBC Documentary on MLM: "Selling the American Dream"