Mr. William Albert Ackman Issues a Statement, in Regard to the $HLF FTC Settlement

I’ve never been a fan of ‘Montauk’ Bill, ever since the days of JCP. However, this HLF shit has gone too far. This is a company of reprehensible qualities. Ackman just issued this press release, in regard to the FTC settlement.

“While it appears that Herbalife negotiated away the words ‘pyramid scheme’ from the settlement agreement, the FTC’s findings are clear. As part of the settlement, Herbalife can only compensate distributors for ‘Profitable Retail Sales,’ a genuine sale made at a price above the distributor’s average total cost for the product. In light of the fact that the FTC found that Herbalife distributors make little or no profit, or even lose money from retailing Herbalife products, there are no longer any meaningful incentives to become or remain an Herbalife distributor. The settlement also requires Herbalife to eliminate minimum purchase requirements and other inventory loading incentives. Furthermore, in order to maintain eligibility or advance in the plan, distributor requirements must be met through ‘Profitable Retail Sales’ or sales to ‘Preferred Customers,’ who are not buying product to participate in the business opportunity. We expect that once Herbalife’s business restructuring is fully implemented, these fundamental structural changes will cause the pyramid to collapse as top distributors and others take their downlines elsewhere or otherwise quit the business. The FTC complaint and settlement provide a roadmap for regulators in 90 other countries around the world to enforce similar requirements. We intend to work with these regulators to ensure that no future victims are harmed whether in the U.S. or otherwise.”

The stock is well off its highs, but still doing great for the day.