U.S. Senator Ed Markey wants Herbalife (HLF) investigated for a possible pyramid scheme as HLF stock fell over 12% Thursday.
Bill Ackman called Herbalife a pyramid scheme back in December 2012 and Markey is now doing the same. He’s calling on the Securities and Exchange Commission as well as the Federal Trade Commission to investigate the company.
Markey said that he’s heard complaints of “improper pressure and financial hardship” from Herbalife distributors. He also said that the company aggressively targets “lower-income and vulnerable communities.” One family even lost $130,000 investing in Herbalife products.
Markey also sent a letter directly to Herbalife asking for more information on how the company operates.
HLF stock is down 12.7% in early trading Thursday.