Ackman Compares Herbalife with Pyramid Scheme Fortune Hi-Tech Marketing
Bill Ackman, the hedge fund manager who shorted Herbalife claiming it’s a pyramid scheme, has released a side-by-side comparison of the company with Fortune Hi-Tech Marketing. Fortune, as many readers know, was shut down earlier this year by the FTC for being an illegal pyramid scheme.
Because Fortune is in receivership, the curtain has been lifted on the true health of the company and its distributor force. Ackman uses and compares these figures alongside his analysis of Herbalife. By virtue of being a publicly-traded company, Herbalife must file a Form 10-K with the SEC that comprehensively summarizes the company’s performance each year (and a Form 10-Q each quarter).
Here’s the slidedeck:
What’s fascinating is that this story goes beyond the mere question of whether or not Herbalife is a pyramid scheme. Vanity Fair describes how this debate has become personal between some of the leading hedge fund managers in the country. Millions, perhaps billions, of dollars are at stake, and it’s not just the money being spent by those within the Herbalife community.
Regardless of which side you fall on, this debate is certainly one worth following closely.