Concerned Californians call on Attorney General to look at Herbalife [update] | FT Alphaville

Concerned Californians call on Attorney General to look at Herbalife [update]

Fancy that. We were only just discussing the powers available to the Californian authorities to look at Herbalife the other day. And then we woke up to this press release:

New coalition seeks AG Kamala Harris and Santa Cruz DA Bob Lee’s assistance to investigate Herbalife’s pyramid scheme targeting the Latino community.

A civil rights coalition of Latino and African American community leaders will hold a press conference calling on California Attorney General Kamala Harris to investigate Herbalife’s deceptive marketing and predatory business practices which target vulnerable minority communities.

It arrives from the League of United Latin American Citizens, who would like the prosecutors to dust off a 1986 injunction against Herbalife.

Recently, the coalition sent a letter to District Attorney Lee, whose office (alongside the office of the Attorney General of California) was involved in an earlier injunction against Herbalife, which precluded the company from making certain medical claims, enjoined certain aspects of its marketing practices and required the company to establish compliance systems to validate retail sales.

By its own admission, as much as 80 percent of the company’s distributors are Latino. Herbalife actively recruits vulnerable minorities into its pyramid scheme by featuring extraordinary rags to riches stories even though the vast majority of the participants caught up in the scheme lose money and quit within a year.

Herbalife has said before that it is in compliance with that injunction, that its business is legitimate, that it does not guarantee success, and that it is in no way, shape, or form, a pyramid scheme.

Update. A company spokesperson got in touch to say:

We would welcome an opportunity to educate the group assembled by LULAC, in order to correct the misinformation and misperceptions they have been given about Herbalife by the billionaire hedge fund manager who is shorting our stock for his own profit.

There will be a press conference at 11am Pacific time on Friday, on the steps of the Ronald Reagan Building in LA –where we expect the coalition will announce the details of a free bilingual help line for former Herbalife distributors to report their experiences.

Expect to see:

Brent Wilkes, National Executive Director, LULAC (League of United Latin American Citizens)
Alma Morales Riojas, Chief Executive of MANA, a National Latina Organization
Reverend William D. Smart, SCLC, (Southern Christian Leadership Conference)
Joseph Villela, Senior Policy Advocate, CHIRLA (Coalition for Humane Immigrant Rights of Los Angeles)
Adrian Dove, Chair, CORE (Congress of Racial Equality)
Juan Jose Gutierrez, President, Vamos Unidos
Huntington Park Councilmember Ofelia Hernandez
Cudahy Vice Mayor Chris Garcia

Looks like Herbalife’s new head of community outreach is going to be busy.

Related link:
1986 Injunction Against Herbalife – MLM Watch