The League of United Latin American Citizens (LULAC), the largest Latino civil rights and advocacy group in the United States, is one of the organizations that strongly campaigned and urged the Federal Trade Commission (FTC) and other regulators including State Attorney Generals to investigate the business practices of Herbalife Ltd. (NYSE:HLF). Herbalife has been accused of operating a pyramid scheme by activist investor Bill Ackman.
LULAC claims Herbalife targets low-income Latinos
LULAC sent letters to regulators and accused the multilevel marketing company that sells nutrition and weight loss products of targeting low-income Latinos and other minorities with deceptive marketing practices.
Due to the ongoing calls for inquiry, the FTC launched a civil investigation against Herbalife Ltd. (NYSE:HLF). The SEC and the Illinois Attorney General also opened separate investigations against the company.
The actions of the regulators show that LULAC succeeded in its campaign against the company, but it seemed that some of the leaders within the organization are not happy with the ongoing investigations against Herbalife Ltd (NYSE:HLF).
An article published by the National Institute for Latino Policy (NILP) from La Opinion indicated that the Herbalife investigations are causing friction within the leadership of LULAC. La Opinion learned that at least nine presidents of LULAC expressed in their letters to lawmakers that they feel their leadership did not represent their positions regarding the issue on Herbalife Ltd. (NYSE:HLF).
A letter from Kathy Jurado, president of LULAC Long Beach-San Pedro Council 3246 stated that the “attacks by the national leadership of LULAC do not represent the views of all members of the organization, councils and districts.” She added, “California LULAC was not officially informed that there was a problem and that they needed our support.”
Another letter from Henry Rodriguez, president of LULAC Council Zapatista emphasized that he does not always agree with the leadership of LULAC, citing that councils have autonomy. With regard to the claims against Herbalife Ltd. (NYSE:HLF), Rodriguez said, “With our experience living in San Antonio, we know that our community has received many benefits from Herbalife; have jobs, money, have progressed in their lives.”
According to him, the idea of speaking publicly regarding the disagreement on the issue of Herbalife Ltd (NYSE:HLF) came after his conversations with colleagues and friends at the Cesar Chavez Foundation. The company sponsored the gala for scholarships organized by the foundation for education and the legacy of Cesar Chavez this year.