Nu Skin under SEC investigation, enforcement pending?
Details on this one are currently sketchy.
Last year in September, Probes Reporter contacted the SEC regarding possible “investigative activity” and were advised there was none.
In what appears to be an annual check, Probes Report contacted the SEC again recently and the agency acknowledged ‘some sort of investigative activity‘ was taking place.
Probes Reporter filed a Freedom of Information Act request, which the SEC denied on the basis that ‘the responsive matter remains open and that releasing the withheld information could reasonably be expected to interfere with the on-going enforcement proceedings‘.
In line with the SEC’s policies and procedures, officially there’s no information available on the currently open investigation. At the time of publication, Nu Skin themselves have thus far acknowledged the investigation too.
The company has not previously disclosed it was under investigation, with what Nu Skin is being investigated for and for how long remaining unknown for now.
This is in contrast to earlier this year when Herbalife, to their credit, voluntary disclosed that it was under FTC investigation.
One can only wonder why Nu Skin are wanting to keep the details of this SEC investigation under wraps.
Just last Wednesday Nu Skin CEO Truman Hunt told analysts
to our knowledge, the SEC has not opened a formal investigation nor made any request for the production of documents.
The plot thickens.
Back in January this year Nu Skin came under fire in China for being a pyramid scheme. After a number of wheels were greased, the company and its top Chinese affiliates were handed down a paltry $781,000 fine.
Are we going to see similar pyramid scheme charges filed by the SEC some time in the near future?
here’s the full statement of CEO truman hunt on the Q3,2014 earnings call on nov,5 :
note the phrase ‘At the SEC’s request ‘, hence confirming at least an informal investigation . truman hunt is trying to convey that the SEC is reviewing nuskins china troubles .
i think there’s more to it . meanwhile stock has tanked.
Nu Skin, Herbalife, Amway, and 99% of all MLM companies have the same thing in common, that being that the vast majority of all of their “distributors” (i.e. “members”) don’t have retail customers.
The term “distributor” is left over from the old days of MLM. These days it’s just people signing up, buying product for personal use AND buying product to keep “active” in the pay plan, and recruiting others to do the same.
And that, my friends, makes most MLM companies mere “buying clubs”.
I’m no legal expert, nor am I a prophet, but I have a hunch that the MLM industry as we know it is going to be turned inside out and cleaned up, and for the better.
and that, my friends , is completely legal, because the FTC says so itself .
absolutely , a good clean up, can never be a bad thing !
At some point in time, the Nu Skin “Stair-step to heaven but you end up in HELL” comp plan will start to come unglued and it will catch up to them.
It could be happening now. I will not feel any remorse at all when it does. They make the Mafia look like kindergartners.
did you know about this, OR , what happened to this ?
“misleading representations to investors regarding its business in China ” and the subsequent fall in the stock , leading to heavy investor losses COULD BE the reason behind the informal SEC investigation . it MAY not be about the business model of nuskin .