Documents obtained by The Post indicate that Kamala Harris ignored calls from her staff to analyze Herbalife for pyramid-scheme behavior while serving as Attorney General of California — all while her husband, Douglas Emhoff, worked for the law firm representing Herbalife.
In response to the documents, Harris’s staff really helpful she investigate the Los Angeles-based company, which sells dietary supplements and weight reduction shakes through individual sellers in a multi-level marketing structure.
In a March 2015 memo addressed to then-AG Harris, her staff suggested investigating allegations that the corporate was “engaging in various tactics designed to maximise the variety of distributors selling its products, which leads to money flow back to those at the highest of the organizational pyramid.”
Harris’ staff really helpful putting a minimum of two full-time attorneys on an investigation of Herbalife. AP
The documents obtained by The Post corroborate that Harris’s employees acknowledged there was “need for formal investigative authority” to find out whether the corporate attempted “to skirt around” regulations stopping Herbalife from making “false or misleading representations” about its products or the profits distributors could make.
The memo, written by Supervising Deputy Attorney General Judith Fiorentini and Deputy Attorneys General Sanna Singer and Jinsook Otha, suggested interviewing former distributors, subpoenaing company documents and deploying undercover investigators.
It also requested a minimum of two full-time attorneys to analyze the corporate.
“Conducting an investigation of Herbalife at this juncture will send the message that this office takes continued monitoring and enforcement of its existing judgements very seriously,” the memo reads. “As well as, it should be certain that Herbalife is held accountable for the acts of its distributors.”
Harris didn’t act upon her staff’s suggestion to analyze — something Bill Ackman tweeted about on X Thursday, suggesting the choice can have been related to her husband’s relationship with the corporate.
Bill Ackman, who shorted the corporate, has long accused Herbalife of being a pyramid scheme. Matthew Eisman
The Pershing Square CEO pointed to the undeniable fact that Harris’s husband, Doug Emhoff, was a partner at Venable LLP, a law firm which represented Herbalife during an investigation by the FTC.
Emhoff was Partner-in-Charge of the Los Angeles office. He didn’t, nevertheless, represent Herbalife personally. Harris and Emhoff married in August of 2014, lower than a yr before the memo was delivered.
“The entire situation is an incredibly damning indictment of how our regulatory enforcement apparatus works,” Ackman wrote.
Activists have accused Herbalife of exploiting the Hispanic community and others via a multi-level marketing structure. REUTERS
Ackman, who shorted Herbalife by $1 billion in 2012, has long alleged the corporate is working a pyramid scheme, and wrote on Thursday that “it is unhappy so many with so little have been deceived and bankrupted by Herbalife.”
Activists say Herbalife disproportionately exploits the Hispanic community, where their products are especially popular, by recruiting low-income sellers in an alleged pyramid structure.
Back in 2013, Angelica Salas, executive director of the Coalition for Humane Immigrant Rights of Los Angeles, called on Harris “to assist us protect vulnerable, low income Latinos and other minorities from these schemes which have cost people their life saving.”
Kamala Harris’s husband, Doug Emhoff, worked for the law firm representing Herbalife when she was advised to analyze the corporate. Los Angeles Times via Getty Images
Bill Ackman suggested Harris’s decision not to analyze the corporate can have been related to her husband’s relationship with Herbalife. Los Angeles Times via Getty Images
Ackman took to X to have a good time Herbalife’s stock price dropping by 30% on Thursday, to a 14-year low, after the corporate posted mixed fourth-quarter results.
“[Herbalife] distributors are generally low income, often undocumented aspiring entrepreneurs pursuing what they’re misled to imagine is the American Dream,” Ackman said.
Investor Carl Icahn became Herbalife’s biggest shareholder while Bill Ackman shorted the stock. Neilson Barnard
He ultimately folded on his bet against Herbalife in 2017, after a standoff with investor Carl Icahn who poured money into the corporate and have become its largest shareholder.
Nonetheless, Ackman described Thursday as “a excellent day for my psychological short on Herbalife” and “an excellent higher day for the world to see considered one of the largest pyramid schemes fail.”
Herbalife didn’t reply to The Post’s request for comment, nor did representatives for Vice President Harris.
A spokesperson for the California Attorney General’s office declined to comment.
