Ackman's Pershing Square Issues Statement on Herbalife (HLF)
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Bill Ackman's Pershing Square issued the following statement on Herbalife (NYSE: HLF), following the company's successful re-audit. The firm said it is not the role of an auditor to determine if the company is a pyramid scheme.
Pershing Square's Statement:
"It is not the role of Herbalife's auditor to determine if the company is a pyramid scheme. Rather, that determination depends on whether distributors earn more from recruiting new distributors than from retail sales to consumers who are not distributors. The few Herbalife distributors that make money earn the vast majority of their profits from recruiting. Herbalife is a pyramid scheme that will be shut down by regulators."
Pershing Square's Statement:
"It is not the role of Herbalife's auditor to determine if the company is a pyramid scheme. Rather, that determination depends on whether distributors earn more from recruiting new distributors than from retail sales to consumers who are not distributors. The few Herbalife distributors that make money earn the vast majority of their profits from recruiting. Herbalife is a pyramid scheme that will be shut down by regulators."
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