Multi-level marketing company Herbalife (NYSE:HLF) is the target of the most recent investigation done by Barry Minkow and Fraud Discovery Institute. A new website, Doomed By Design has been developed, and a written report has been released. A short video clip is included, and a full documentary will be released later this year.
Herbalife is the world’s largest multi-level marketing (MLM) company. Barry Minkow and team found that the company is illegally doing business in China. Chinese laws prohibit multi-level marketing businesses from existing in China, and do not even permit their products in the country.
Why the focus on China? As U.S. consumers slowly become aware of the scam behind MLM (or have already been burned by it), China represents a nearly untapped market for MLM. With a population of over 1 billion, the opportunities to profit by introducing a MLM scheme there are lucrative.
The report on Herbalife is long… I’ll summarize the key points later.