Thursday, 24 July 2014

'Herbalife (HLF)' - Bill Ackman hoists battle ensigns, but has the American Republic run up the white flag?

Tuesday the July 22nd, I sat and watched Bill Ackman's much-hyped webcast. This had been presented as being the 'latest nail in Herbalife's coffin.' Indeed, the price of effectively valueless 'Herbalife' shares had dropped more than 10% in the run up to this event. However, whilst Bill Ackman was still speaking, this price began to climb steeply. At the beginning of the webcast, at least 10 000 persons were watching.

With an irony close to exquisite, on a day when white flags temporarily replaced the Stars and Stripes which usually flutter at either end of the Brooklyn Bridge, an unusually emotional Bill Ackman again hoisted battle ensigns and courageously attempted to lead an investor-charge against the 'Herbalife' racketeers. In reality, all Bill Ackman succeeded in doing was to prove that Wall St. is largely a morality-free zone, and that US federal government agencies should have long-since run up white flags on their own buildings. 

Apart from the results of a rigorous, private investigation into what actually happens behind the seedy, green-draped fronts of so-called 'Herbalife Nutrition Clubs,' Mr. Ackman's latest presentation brought nothing original to the dismantling of the blame-the- victim 'MLM Income Opportunity' racket entitled 'Herbalife.'  Indeed, the reality-inverting sections of the 'Herbalife' labyrinth he invited his audience to enter, and examine, have already been rigorously explored on 'MLM The American Dream Made Nightmare.'

In summary, in his webcast, Mr. Ackman explained how:

  •  'Herbalife' is an elaborately disguised pyramid scheme which has previously targeted the middle classes, but which is now going after the poor in the USA (particularly, from the Latino community) and internationally (particularly, in countries right at the bottom of the scale for average per capita incomes).
  • 'Herbalife's' own documentation reveals that the targeting of the poor and vulnerable, has been a deliberate global strategy instigated by the bosses of 'Herbalife' in the USA. 
  • the bosses of 'Herbalife' have hidden behind a shifty labyrinth of apparently independent corporate structures which have been used to sell the American Dream to vulnerable people who (like Mr. Ackman's own Eastern European Jewish immigrant ancestors) desperately need to believe that it is true.
  • 'Herbalife' adherents have been deceived into handing over their time and money on the pretext that they can learn to duplicate an exclusive system which will enable them, and their children and their children's children, to enjoy total financial freedom.
  • there have been virtually no authentic retail sales to the public taking place within the so-called 'Herbalife MLM income opportunity.'
  • what have appeared (to casual observers) to be retail sales to the public (regularly being conducted in so-called 'Herbalife Nutrition Clubs' ), have merely been part of a self-perpetuating charade acted out as reality by a never-ending chain of obedient 'Herbalife' adherents, in the false expectation of future reward. 
  • effectively everyone who has participated in the so-called 'Herbalife MLM income opportunity,' has failed to generate an overall net-income from it and, eventually abandoned it, to be replaced by the latest crop of transient, ill-informed victims who, in turn, have been deceived into duplicating the same economically-suicidal system of recruitment and self-consumption.
  • 'Herbalife' adherents/victims have been subjected to social and psychological persuasion techniques - designed to get them to believe that failure to make money was entirely their own fault.
  • the corporate officers/ directors of 'Herbalife' have been fully-aware of the organized criminal  activities which have been omnipresent within their company, and from which they have profited massively. They have not only conspired to hide the results of these criminal activities from regulators, investors and the public, but they have also enthusiastically participated in, and directed, them.
  • 'Herbalife' is an example of the totalitarian/ Nazi propaganda technique known as 'the big lie.'
  • The bosses of 'Herbalife' have sponsored professional sport and co-opted ill-informed celebrities, and opinion-makers, like David Beckham and Madeleine Albright, to make their criminal enterprise appear to be entirely legitimate.

It's difficult to believe that it has taken Mr. Ackman more than 18 months and 50 millions dollars, to arrive at this level of understanding of the criminogenic cult phenomenon. 

That said (to Bill Ackman's credit), he has evidently been trying very hard to understand.

Unfortunately, Bill Ackman has not yet publicly acknowledged that 'Herbalife' itself is neither original nor unique and that, consequently, it cannot be fully-understood in isolation; for 'Herbalife' is only the title of one chapter of an even bigger, and evolving, lie.

More than half a century of quantifiable evidence, proves beyond all reasonable doubt that what has become popularly known as 'Multi-Level Marketing,' is nothing more than an absurd, cultic, economic pseudo-science, and that the impressive-sounding made-up term 'MLM,' is, therefore, part of an extensive, thought-stopping, non-traditional jargon which has been developed, and constantly-repeated, by the instigators, and associates, of various, copy-cat, major, and minor, ongoing organized crime groups (hiding behind labyrinths of legally-registered corporate structures) to shut-down the critical, and evaluative, faculties of victims, and of casual observers, in order to perpetrate, and dissimulate, a series of blame-the-victim closed-market swindles or pyramid scams (dressed up as 'legitimate direct selling income opportunites'), and related advance-fee frauds (dressed up as 'legitimate training and motivation, self-betterment, programs, leads,' etc.).

David Brear (copyright 2014)


  1. In India, people are still falling for the dubious promise of easy money and losing their hard-earned savings.

    1. Shyam - To date, Mr. Ackman has spent $50 millions researching just 'Herbalife,' and all he's achieved is an ongoing investigation of this single blame the victim 'MLM income opportunity' racket, conducted by various agencies of the US federal government - all of which have previously failed to tackle the overall problem.

      Despite Mr. Ackman's efforts, the 'Herbalife' racket is still legally-registered all around the globe as a labyrinth of corporate structures pusuing lawful, and/or unlawful, enterprises.
      The Herbalife' racket has been consuming millions of individuals annually, but 'Herbalife' is only one part of an overall criminogenic phenomenon of historical significance.

      During Mr. Ackman's recent presentation, he was invited to say what he thought about other so-called 'MLM income opportunities,' but he declined on the grounds that he had not examined their activities and, therefore, was not in a position to comment.

  2. Ackman now says he will never do anything like this again.

    1. Anonymous - I presume you are referring to Ackman's recent CNN interview? - if so, this is not exactly what he said, but it is quite close.

      From this interview, I get the distinct impression that Bill Ackman now realizes that, by challenging 'Herbalife,' he has, in fact, challenged part of something far more pernicious and which he didn't fully-understand.

      It is entirely possible that, with the benefit of hindsight, Bill Ackman, would never have taken on 'Herbalife,' but that doesn't mean that his analysis of 'Herbalife,' as a criminal enterprise, is wrong.

      'Herbalife' is, indeed, a criminal enterprise, but it is only part of a criminogenic phenomenon.

  3. David,
    I believe that Bill Ackman discovered a truth which is inconvenient here in the states. Just as firebrands railed against the cruelty and inhaminity of slavery in the years leading up to the American Civil War and were branded kooks, ill informed; we, the free thinking critics of MLM are branded also branded ‘kooks’ and ‘crazy’ by the apologists.
    One man, making a stand against slavery, John Brown , did more to spark a revolution: the American Civil War. A jury of Brown’s peers in Virginia convicted and executed Brown, but his sacrifice was a rallying cry for all the others who were to lay down their lives to end the injustice of slavery.
    Mr Ackman may fail, but in my opinion, truth is never a failure. John Brown’s views were not wrong, and neither are Mr. Ackmans enlightened observations about Herbalife. Sadly, you cannot destroy a hydra by only killing one of its many heads. You must put them all out of business.
    I like what I see happening in India today. I view Shyam Sundar as heroic. More people both powerful and weak need to stand up and do what is right. I am encouraged by Robert Fitzpatricks open letter to the FTC. I commend you David for what you’ve accomplished, especially in Great Britain. Battles may be lost but the war can still be won. Evidence of this is embodied in the strength and wisdom of Winston Churchill.
    Critics do not have to spend millions to discover the bad truth about Herbalife. Everyone of the slave states were wrong; just as all the Hebalife’s and Amway’s are equally wrong. It is to the shame of U.S politicians who view these MLM criminals as a cash cows for their political aspirations and permit them to export their schemes to India and elsewhere. If those in the world’s largest democracy can discern the truth, why can’t those in the Americas discern it as well?
    I express my views in hope that a single reader might see, and decide against signing on with a cult of greed. Those who are lost in it already must ‘hit rock bottom’ before they discerning the truth and their ability to think independently returns. There are those who claim that brain washing is merely a myth. These 'well ordered gentlemen' need to wake up out of their own nightmare. Their American Dream has truly been usurped.

    1. quixtarisacult - Bill Ackman has finally discovered that, in 'Herbalife,' the reality-inverting totalitarian world described by George Orwell in 'Nineteen Eighty-Four,' has literally come to pass, because 'MLM-Freedom, is Slavery,' whilst the so-called 'MLM income opportunity,' has been a highway to destitution, debt and depression for many.

      Overt slavery might have been outlawed, but sadly, covert slavery continues. Tellingly, when I used the term, 'de facto slaves,' to describe the chronic victims of 'MLM' rackets on Seeking Alpha, I was met by a storm of outrage.

      I'm not so sure I accomplished that much in the UK. The 'Amway' racket was only partially investigated by civil regulators, and its instigators managed to escape a rigorous criminal investigation/prosecution.

      At the time, these complex matters were reported in a very simplistic way in the mainstream UK media.

      Although I didn't have millions of dollars at my disposal, Bill Ackman seems to have taken a very similar attitude towards 'Herbalife' in the USA, as I originally took towards 'Amway' in the UK.

      So far, Ackman has ignored the wider 'MLM' phenomenon and assumed that, because 'Herbalife' is so obviously a pernicious fraud, when presented with the evidence, the regulators must close it down. However, slowly he's beginning to realize that, due to their previous refusal to look beyond the ends of their noses, US regulators have long since become a major part of the 'MLM' problem.

      Ackman spoke of 'Herbalife selling the American Dream.' In reality, dozens of 'MLM income oppotunity racketeers have been peddling variations of the same self-perpetuating totalitarian Nightmare packaged as 'the American Dream.'

      Evidently, Bill Ackman is slowly coming to the same point of view as myself and others, whilst the 'MLM' racketeers and their apologists are now piling the pressure on him in a desperate attempt to prevent him from confronting the full truth and broadcasting it openly.

      In a situation like this, where their absolute monopoly of information is threatened, the only weapon left to the 'MLM' cultic racketeers and their apologists, is ridicule. Bill Ackman has already let it slip in a CNN interview that he finds unjustified attacks on him, to be very difficult to take.

  4. I believe that the MLM industry should be shut down unless there is major reform with tight regulations. That is the outcome I hope for in the Herbalife invesigtation. Somehow I doubt that the FTC will have the cajones to shut them down. MLM is a blight to society where the vast majority make nothing or lose money. If MLM were gone, only the statistically insignificant "kingpins" and MLM owners would be saddened. If Amway's and Herbalife's products had sincere public demand as they claim, having MLM shut down would not prevent the company from running and profiting from product sales.

    But the reality is that without sales to their own sales force, Amway and Herbalife are doomed and would soon become extinct.

    I hope Bill Ackman's actions result in major reformations or the closure of what I see as a scam MLM company.

  5. Joecool - It is my considered opinion that what has been commonly-referred to as 'MLM,' is not an 'industry' (in the traditional sense of the word), but it is fraud on an industrial-scale.