Herbalife shares plunge after law enforcement investigation is revealedBy Mason White 11:11 AM February 5, 2013
By: Debbie Gross
(Scroll down for video) The bad press for Herbalife just continues just weeks after a popular hedge fund manager called the company a giant pyramid scheme.
Herbalife shares fell more than 6 percent after a New York newspaper reported that the company was the subject of a law enforcement investigation.
In early trading on Wall Street, shares of Herbalife lost $2.25, to $32.82. Herbalife shares are off 44 percent compared to the same time last year.
The newspaper cited documents obtained through an application of the Freedom of Information Act, from the Federal Trade Commission.
According to the newspaper, the FTC cites “pending police action” and withheld part of the information requested on Herbalife. The newspaper said that the FTC released 729 pages of complaints against Herbalife.
Herbalife has been on the defensive from New York hedge fund manager Bill Ackman, who declared the company a pyramid scheme in late December.
Ackman announced a short position of $1 billion against the company, which calls itself a multi-level marketing company that sells vitamins, nutritional supplements and food.
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