SEC Charges Herbalife With FCPA Violations

SEC

Herbalife Will Pay More Than $123 Million to Settle With Government

The Securities and Exchange Commission today announced that Herbalife Nutrition Ltd. has agreed to pay more than $67 million to settle charges that it violated the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act (FCPA).  In a parallel action, the U.S. Department of Justice and the U.S. Attorney’s Office for the Southern District of New York today announced that Herbalife will pay a criminal fine of more than $55 million for a total of more than $123 million paid in both actions.      

The SEC’s order finds that Herbalife’s Chinese subsidiaries made payments and provided meals, gifts, and other benefits to Chinese officials in connection with obtaining sales licenses, curtailing government investigations of Herbalife China, and removing negative coverage of Herbalife China in state-owned media.  As set forth in the order, Herbalife China managers asked employees to falsify expense documents in an effort to conceal the improper payments. read more »

U.S. Antitrust Case Against Google Zeroes In On ‘Tying’ Products

BLOOMBERG

Government officials building an antitrust case against Google are investigating whether the company engages in tying, the practice of bundling different products together in a way that can block out competitors and give the seller an unfair advantage.

In recent months, the Justice Department and state attorneys general have asked executives at rival firms about the pricing and operations of Google’s Network division, according to people familiar with the discussions. This business sells services that handle almost every step a digital ad takes on its journey from a brand’s creative team to a consumer’s screen. read more »

SEC Charges Ponzi Scheme Targeting African Immigrants

SEC

The Securities and Exchange Commission today charged two Maryland companies and their principals for a scheme that allegedly defrauded approximately 1,200 investors, many of them African immigrants, of more than $27 million.

According to the SEC’s complaint, Dennis Jali, John Frimpong, and Arley Johnson, directly and through their companies 1st Million LLC and The Smart Partners LLC, falsely told investors that their funds would be used by a team of skilled and licensed traders for foreign exchange and cryptocurrency trading, promising risk-free returns of between 6% and 42%. The complaint alleges that the defendants often targeted vulnerable African immigrants and exploited their common ancestry and religious affiliations. The complaint further alleges that Jali, who claimed to be a pastor and falsely held himself out as a self-made millionaire and expert trader, rented office space to conduct in-person meetings and give the appearance of a legitimate company. According to the complaint, the defendants diverted investor funds for personal use and to make Ponzi payments to prior investors. read more »