FILE – This Feb. 6, 2012, file photo, shows William Ackman, of Pershing Square Capital Management, in Toronto. On Tuesday, March 11, 2014, Ackman held a public event to detail his firm’s claims of how Herbalife is operating as a pyramid scheme in China, violating laws there. On Wednesday, Herbalife Ltd. said that it is facing an inquiry from the Federal Trade Commission. (AP Photo/The Canadian Press, Pawel Dwulit, File)
NEW YORK (AP) — Hedge fund manager Bill Ackman has won a round in his 15-month fight against supplements and weight-loss products maker Herbalife. The direct seller’s shares tumbled Wednesday after Herbalife revealed that it is being investigated by the Federal Trade Commission for possible “deceptive practices.”
Since December 2012 Ackman has spent millions waging a public campaign against Herbalife and building up an army of lobbyists, community organizers and members of Congress to push regulators to investigate what he calls a “pyramid scheme,” that makes most of its money by recruiting new salespeople rather than on the products they sell. It is a charge that Herbalife has repeatedly denied.
Ackman, the head of Pershing Square Capital Management, holds a whopping $1 billion “short” position in Herbalife, meaning he’s bet that the company’s stock will drop and Login to read more