"The scientific community is almost monolithic against you in terms of the efficacy of those three products that you called miracles. When you call a product a miracle, and it's something you can buy, and it's something that gives people false hope, I just don't understand why you need to go there."
-Senator Claire McCaskill to Dr. Oz
We've gone over some of the insane medical claims that have been used by distributors to sell Herbalife (NYSE:HLF) products. If you look at this article that I penned a little while ago, I've listed the outrageous claims that are used by distributors to sell their growing mountains of Herbalife inventory that they likely stockpiled while buying themselves to the SUPERVISOR level.
I encourage you to click here and look at the photos and testimonials. In the interest of brevity, I'm not going to copy/paste all of them here.
We have two problems here - both of which, I believe Herbalife corporate is extremely liable for:
1. Distributors are coerced into buying $3,000 worth of product up front in order to become SUPERVISORS, so they have the right to recruit for money and "sell the business opportunity." Once they have inventory loaded, they need to make more and more outlandish statements to sell the otherwise commodity product in a super saturated, unregulated market for "retail" sales.
2. Herbalife doesn't discipline nearly enough distributors and this "rule" isn't taken seriously/is backhandedly allowed by corporate - or so it would seem.
Needless to say, there are a lot of people out there making false medical claims about Herbalife's products. Famously, on ABC's Nightline, a man claimed that it helped a woman cure a brain tumor! Funny, you may think, but when you think about this as a means to have someone part with their hard earned money, it simply becomes tragic and sad.
Regardless, it certainly sounds like Herbalife products are a magic group of items, no?
Which brings me to my next topic of discussion.
For those that have missed the controversy this past week about TV host Dr. Oz - he's come under fire for a series of statements he's made on his shows about dietary supplements that have not been approved by the FDA.
For some reference, here's a quick reminder of what the word "miracle" means:
(click to enlarge - source Google)
"Not explicable by natural or scientific laws and therefore considered to be the work of a divine agency" - hmm.
Now, here's three examples of exactly what I'm talking about:
"Miracle for longevity?"
"Miracle for burning fat?"
"Another miracle in a bottle?"
Tsk, tsk. Dr. Oz should know better. I can't imagine the Doctors that have spent their entire lives dedicated to truth and science having to watch his show and cringe as he lops false, non-scientific promises of miracle cures onto the collective bowl of guacamole dip, which are the brains of U.S. daytime television viewers.
And recently, it's led Dr. Oz into some heat. Senator Claire McCaskill, who is heading up a Senate committee focused on the crackdown of dietary products first put forth by the FTC this January, is less than amused with Dr. Oz.
McCaskill did a great job of grilling Dr. Oz at his Senate hearing; injecting some realism and reality into the grey area between science and "miracles" that the doctor has created. The Atlantic had a fantastic article that went into full detail about the Senate hearing, which I encourage you read in its entirety. Here's a small except from the piece in The Atlantic:
"I can't figure this out," Senator Claire McCaskill prompted Mehmet Oz yesterday, from halfway across a capacious hearing room. Her tone implied that, at least to some degree, she had figured it out.
That was the reason her subcommittee summoned Oz to Washington.
"I get that you do a lot of good on your show. I understand that you give a lot of great information about health in a way that's easily understandable. You're very talented, you're obviously very bright, and you've been trained in science-based medicine." Accolades piled up until a buckling of decorum was imminent.
"Now, here are three statements you made on your show."
McCaskill read Oz's words from past segments of The Dr. Oz Show back to him with a clinical formality that underscored their absurdity:
"You may think magic is make-believe, but this little bean has scientists saying they've found the magic weight loss cure for every body type: It's green coffee extract."
"I've got the number-one miracle in a bottle to burn your fat: It's raspberry ketone."
"Garcinia cambogia: It may be the simple solution you've been looking for to bust your body fat for good."
McCaskill continued, as if reproaching a child. "I don't know why you need to say this stuff, because you know it's not true. Why-when you have this amazing megaphone and this amazing ability to communicate-would you cheapen your show by saying things like that?"
No doubt, it's valiant work that the Senator is doing. Don't we already have enough pseudo-scientific garbage in our daily lives with charlatans like the Long Island Medium, continued belief in astrology, and group after group of people who mistake the hydrocarbon vapor trails from aircraft for chemical trails that the government is spraying on us to reduce the population?
Do we really, in this day and age, need yet another layer of false hope out there like this "kit that holds all the answers" as promoted by Sean Hannity? Can you believe this is how Herbalife has resorted to recruiting distributorships?
Senator McCaskill - if you think Dr. Oz's claims are some real steaming whoppers, why not start to peek your head into some of the claims that are being made by Herbalife distributors to move products?
Once you've wrapped your head around that, why not take a peek at why it is that distributors have to make these claims in order to sell product - they've got too much inventory, and Herbalife's products are overpriced commodities that use the extra money to support the pyramid structure of the company.
It's no secret I contend that Herbalife is a rigged global confidence game that bilks money out of leads that they "wring dry" by promising false claims of wealth and a fraudulent business opportunity.
Senator, you are one of the last critical thinkers this country seems to have. I thank you for the mega dose of realism that you are helping inject upon the American people - and I beg of you:
Help us stop Herbalife.
Disclosure: The author is short HLF. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.