[straight news network Beijing on July 18 hearing] (Wall Street Journal) Herbalife (Herbalife) did engage in pyramid schemes is not important, regulators in the US Federal Trade Commission (FTC) has agreed to the company to pay $2 million to settle allegations. Dow Jones newswires also changed, called FTC on the Herbalife business belongs to the MLM without judgment. The most bitter is three and a half years accused Herbalife MLM and short the stock of our hedge fund manager Bill Ackman.

Local time Thursday night, Herbalife for two years of investigation the FTC issued a statement, said Herbalife deceive consumers sold the our products can be lucrative charges, reached a settlement with Herbalife, Herbalife agreed to a comprehensive restructuring of its U.S. market business, and to compensate consumers $2 billion. The settlement requires herbalife:

Modify the remuneration system, the decision to pay the standard should not be added to the distribution of the company's products, but there are no sold products, that is, the retail sales;

The abolition of the main recruitment and distribution of staff and set the reward;

Will only get a discount for the purchase of a distribution and to seek business opportunities to join the distinction between treatment, the former no need to sell products, win the reward;

At least 80% of the sales of the product must come from the legitimate end users, or must be reduced to the distribution of incentives;

If the distributor has not completed a full year, not completed its business training, shall not be allowed to produce a lease or buy "Nutrition Club" and other business premises related costs;

The potential of the distributor and the income may be misleading, in particular, shall not claim to be able to join the work, otherwise unable to enjoy the superior life.

From the FTC statement, there are many influence of reconciliation on the Herbalife business. But Herbalife has since said, "will not change as a direct selling company's business model, the terms of the settlement applies only to the United States, and the United States market contributed only about 20% of the company's net sales revenue. Herbalife said: "our business model that reconciliation is good."

FTC chairman Edith Ramirez said it is worth pondering. British "Financial Times" reported, said for the FTC to win Herbalife compensation than for the division is the MLM problem for many years lawsuit is more important. Because Ramirez says:

"We are not about (to Herbalife) what label affixed. I want you to draw your own conclusions based on the facts of this case...... They (Herbalife) whether the Pyramid MLM and inconclusive."

"The Wall Street journal" reported is that the same FTC can make reconciliation to avoid being classified as Pyramid Herbalife mlm. And the active investor Icahn Carl also get benefits. Herbalife has since announced that Icahn is currently held by the division 18.3% of the outstanding shares, the future holds ratio limit will be preceded by 25% to $34.99%.

And news of the FTC settlement, Dow Jones newswires and other media initially said most of the FTC thinks Herbalife not a pyramid scheme. Then, the Dow was renamed the FTC did not determine the Herbalife is MLM.

No matter what Herbalife MLM, stock investors are given a positive response. Wall Street informative article mentioned yesterday, Herbalife shares in early trading Thursday surged 18 per cent, midday or significantly narrowed, present in about 10%. This year the company's share price has risen by about 21%.

But whether it is FTC or reconciliation with Herbalife shares soared, to adhere to the bearish Ackman is not a good news for herbalife.

As early as the end of 2012, ackman accused Herbalife is in the operation of a pyramid pyramid scheme is presented, and a target price: $0. He more than once in public or personally issued a report Herbalife sing empty.

Ackman Pershing led Square fund has publicly held Herbalife at least 10 billion dollar short positions.

Public documents show that Pershing's Square Ackman this year, poor performance. The fund in the first half of this year fell by 21.1%. Herbalife is 12 shares of Pershing Square holds only in the positions. 3

(original title: Herbalife $2 settlement with FTC shares rose off marketing hat)

Editor: Chen Feng

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