The NYPD Hispanic Society has called on New York State Attorney General Eric Schneiderman to investigate Herbalife Ltd. (NYSE:HLF). The news comes after Herbalife soared on news that the company’s new auditor verified financial statements for the years 2010, 2011, 2012.
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Below is the press release from NYPD Hispanic Society RE Herbalife
The NYPD Hispanic Society is calling on the New York State Attorney General Eric Schneiderman to launch an investigation into the multi-national company Herbalife Ltd, which is a complex pyramid scheme unfairly targeting and misleading independent Latino distributors, promising profits that are all but unattainable. Many Latinos have been victimized by Herbalife’s aggressive recruitment and illegal business practices.
Many of these sellers known as distributors have discovered that selling the products has been harder than they thought. After reaching out to family and friends to buy these Herbalife products, some have resorted to spending hundreds and even thousands of dollars buying sales leads, which often times have led nowhere. The real money is in recruiting others to sell the product, creating what’s known as a “down-line” of distributors. The more distributors they recruit, the more money they are likely to make based in part on a combination of bonuses and commissions. Unfortunately, once new recruits become Herbalife sellers they most often end up in debt and unable to make a profit. It’s difficult for these people to sell enough of the product in order to realize a significant return on investment. Many of these Latinos are ending up in serious debt as a result of Herbalife’s recruitment and illegal business practices.
Given these allegations, we urge the Attorney General’s office to open a full investigation into Herbalife’s recruitment and business practices. If it’s proven to be biased and unfair, Herbalife would be responsible for personal harm and financial distress of many Latino communities across New York and the country.
NYPD Hispanic Society