Investments: Herbalife resists latest accusations
Billionaire investor William Ackman's latest volley of accusations against Herbalife missed its mark on Wall Street, with investors sending the stock price soaring 25pc.
Mr Ackman, who has been battling the California-based nutrition company for 19 months and has a $1bn (€742m) bet it will eventually go bust, told 500 people in a New York auditorium - and thousands watching a webcast - that Herbalife is a criminal enterprise that targets minorities, counts non-existent customers, and breaks labour laws.
Mr Ackman, founder of the $14.7bn hedge fund Pershing Square Capital Management, is calling the company a pyramid scheme where members earn more money from recruiting than by actually selling products to end users.
Herbalife has rejected the claims.
In a three-hour presentation, Mr Ackman accused officials of moving too slowly against Herbalife. The US Securities and Exchange Commission, the Federal Trade Commission, and the FBI are among those probing the company's business practices.
"Unfortunately, Bill over-promised and under-delivered on this presentation," said Vijay Marolia, of Regal Point Capital Management.