Pershing Square: ABC News Exposes Herbalife Ltd. (HLF) Fraud

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Pershing Square: ABC News Exposes Herbalife Ltd. (HLF) Fraud
By Herbalife International of America, Inc. (http://www.herbalife.com) [CC BY-SA 4.0], via Wikimedia Commons

ABC News Investigation Exposes Herbalife Ltd. (NYSE:HLF) Fraud

New York, NY April 24, 2014 — Last night on Nightline, ABC News revealed some of the results of its in-depth, six-month investigation of Herbalife Ltd.  Using undercover footage of Herbalife-sponsored extravaganzas and hidden camera video of recruiting presentations at nutrition clubs, ABC’s investigative report revealed examples of the pervasive and fraudulent wealth and health claims that drive Herbalife’s pyramid scheme.  Pershing Square Capital Management, L.P. encourages interested parties to watch the Herbalife Nightline segment available at http://abcnews.go.com/Nightline/video/herbalife-investigation-part-american-dream-sale-23449013.

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ABC’s investigation proves that false and deceptive practices by Herbalife and its distributors are pervasive throughout its corrupt operation, which Pershing Square has extensively documented in a series of presentations, reports, videos, and dossiers that can be found at www.HerbalifePyramidScheme.com andwww.FactsAboutHerbalife.com.

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As has been reported publicly, Herbalife Ltd. (NYSE:HLF) is now under formal investigation by the Federal Trade Commission, the Securities and Exchange Commission, and the Canadian Competition Bureau, as well as a criminal investigation by the Department of Justice and Federal Bureau of Investigation.  The New York and Illinois Attorneys General have also recently disclosed investigations of the company.

 

On Nightline, ABC identified one of a number of whistleblowers sourced by Pershing Square, Giovanni Bohorquez, a former Herbalife senior executive.  As disclosed to ABC by Pershing Square, Pershing Square entered into an agreement with Mr. Bohorquez that provided for an indemnity for losses, including lost wages, in the event that he were to lose his employment in connection with his activities as an Herbalife whistleblower.  The indemnity requires that Mr. Bohorquez must at all times testify truthfully about matters of which he is aware.   In the event he loses his job, Mr. Bohorquez’s lost wages are only covered until such time as he finds alternative employment, which he must actively seek under the terms of the agreement.

 

The indemnity was negotiated by Mr. Bohorquez’s legal counsel to protect his client in light of Herbalife’s track record of attacking its critics through litigation and other forms of intimidation.  Pershing Square disclosed the fact of the indemnification arrangement to ABC News and provided it with a copy of the agreement, which ABC published on the Internet prior to last night’s broadcast. http://abcnews.go.com/images/Blotter/agreement_redacted2.pdf

 

“Giovanni is an honest and good man,” stated William A. Ackman, CEO of Pershing Square.  “I can attest to the strength and quality of his character.  I would be delighted to serve as a reference for him as he seeks future employment.”

 

With respect to indemnities provided by Pershing Square to other whistleblowers, including those cooperating with government agencies, these indemnities are limited to legal fees and damages incurred in the event that these individuals are sued by Herbalife Ltd. (NYSE:HLF), and do not provide for recoveries for lost wages.

 

About Pershing Square Capital Management, L.P.
Pershing Square Capital Management, L.P. (“Pershing Square”), based in New York City, is a SEC-registered investment advisor to private investment funds.  Pershing Square manages funds that are in the business of trading — buying and selling — securities and other financial instruments.  Funds managed by Pershing Square are short the stock of Herbalife Ltd.  Pershing Square may increase, decrease, dispose of, or change the form of its investment in Herbalife for any or no reason, at any time.  Pershing Square may change its views about or its investment positions in Herbalife at any time, for any reason or no reason.  Pershing Square may buy, sell, cover or otherwise change the form or substance of its Herbalife investment.  Pershing Square disclaims any obligation to notify the market of any such changes.  Please see the full Disclaimer appearing on website www.factsaboutherbalife.com.

 

SOURCE: Pershing Square Capital Management, L.P.

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7 COMMENTS

  1. CrimeBustersNow

    After seeing others burned up in a Pinto. It would not be necessary to risk my life driving one to know it is not safe. Cover-up of defects at Ford; cover-up of fraudulent Biz-OP at Herbalife.

    And one does not have to “have skin in the game” to be appalled at MLMs targeting university, college and high school students, and now even 14 year old elementary school children. i.e. Vemma, the darling of of Dr. Oz, shut down a couple days ago by Italian authorities as a fraudulent pyramid scheme.

    The truth slowly emerges.

    In 2007 I said… “Hebalife is an insidious pyramid scheme.”….. Hebalife IS an INSIDIOUS pyramid scheme.

    Our record – 100%. We have never been proven wrong in any fraud we have attacked. Defy that record at your own peril.

    David Thornton

    Activist & Concerned Canadian Citizen: Simply doing what
    WE can to expose and eradicate fraud.

  2. You need to explain how an illegal pyramid, making illegal medical claims, and the RICO fraudulent “lead generation” scam businesses can, in any way, be described as ethical at all, let alone NEVER being associated with a more ethical company. What’s your experience, the MAFIA? LOL

    What you need to troll for are the facts, and the facts ALL point to the above issues. LOL

  3. And Intra as I’ve seen you post, you’re trolling for Ackman. What drives you to post and post in multiple forums about a company you’re not involved with in any way. What skin do you have in this? How many times have you tried the products so you can be fair? That’s like never driving a ford and saying that Chrysler is better than a Ford. That also goes for the business side as well. I’ve NEVER been associated with a more ethical company than Herbalife, and I have been in many other companies besides Herbalife. In Herbalife you ever have management decide who is getting promoted…… Get off Ackman’s Kool-Aid an try a shake

  4. Because HLF is a fraud and to protect a whistleblower from being attacked by HLF. Stop making ad hominem attacks on others, Rene. You troll all of these HLF articles saying the same nonsense. The FBI, SEC, FTC or AGs won’t care for your silly arguments when they’re investigating HLF. Are you blind to the ABC report showing HLF distributors taking about pyramid recruiting and curing cancer?! Rene, you are seriously drunk on HLF Kool-Aid

  5. Why would Ackman be willing to pay up to 3.6 million to a whistle blower
    that says something about the “Ethical shortcoming of Herbalife?”
    Anybody know what the whistle blower had to say?

    The whistle blower was a low level manager that was fired for incompetence,
    could not produce a spreadsheet without errors. He was NOT involved in
    executive decisions for HLF.
    The only reason I can think Ackman wanted this “strategic witness” is to get FTC, FBI, et al, involved –
    with the HOPE that it would DRIVE the stock price down! Well, it didn’t
    workout to good! Ackman is a corrupt, underhanded slime ball –

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