Herbalife Issues Statement Regarding ABC News Report On Bill Ackman

(RTTNews) - Nutrition supplements company Herbalife Ltd. (HLF) issued comments on ABC News Report exposing more of Bill Ackman's undisclosed financial arrangements.

ABC News has revealed new information regarding Bill Ackman's, Founder and CEO of Pershing Square Capital, unprecedented $1 billion campaign to manipulate Herbalife's stock to the detriment of Herbalife's shareholders, customers and employees. Ackman's campaign, part of which was uncovered by ABC News, is losing its credibility with each passing day.

The previously unreported information includes confirmation that Ackman has spent more than $20 million to date on his campaign. This includes a contractual arrangement to pay an individual up to $3.6 million over 10 years to make accusations against Herbalife, in addition to Ackman's agreement to pay the individual's legal fees and arrange his public relations efforts.

Importantly, when the individual was on ABC News - an interview that Ackman's PR team helped to arrange - he failed to disclose the existence of his contract with Ackman and, in fact, the contract itself contains a confidentiality clause.

The payments are only one part of a calculated, coordinated and well-funded effort by Ackman and his agents to offer secret, undisclosed payments to individuals and organizations to bring false and misleading charges against Herbalife.

The company said that it provide clear, accurate and timely disclosures to prospective members regarding potential income in its Statement of Average Gross Compensation. Studies have revealed that the vast majority of Herbalife members have realistic expectations of the business opportunity and the effort required to succeed at all levels.

Additionally, as noted in the ABC News report, Herbalife said it is explicit with its members that "products are not intended to diagnose, treat, prevent or cure any disease or medical condition, and under no circumstances should there be any statements, advertising or implications to the contrary."

The company stated that it investigates and takes all claims seriously. The company has a compliance team of more than 300 people worldwide that monitors members' activity and enforce Herbalife's rules. Its compliance operation includes secret shoppers who investigate compliance on the ground, web-monitoring companies to track internet-based compliance and several customer feedback channels.