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Herbalife Possibly Deleting Evidence Of Fraud?

|Includes:Herbalife Ltd. (HLF)

I wanted to quickly pass on an e-mail I received this morning, which is one of many I've gotten over the last two weeks. They all claim the same thing, Herbalife (NYSE:HLF) distributors are being told to take down their Facebook pages:

All our local distributors have removed their Herbal life banners from FB A lot have hidden their work experience. So you can't see HLF independent distributor. Still others have deleted posts about making money from signing up distributors. No more talk about HLF and the business. I'm having a hard time finding a shake post.

I posted my observations on this site. Not one single Distributor refuted or acknowledged. I did get six likes so its not my imagination.

I searched Herbalife in FB I got a handful of hits....It use to be pages.

Something is rotten in Denmark.

Reminds me of this paragraph in Matt Stewart's latest article, regarding the SAC Capital mess:

As an initial matter, the SAC ENTITY DEFENDANTS automatically purged all instant messages after 36 hours and all e-mails not affirmatively saved after 30 days until adopting a revised document retention policy in September 2008. In addition, prior to approximately late 2009, SAC's compliance department rarely reviewed electronic communications by SAC employees for suspicious terms suggesting potential insider trading, notwithstanding the fact that the head of SAC compliance had recommended such searches to SAC management as early as 2005.

Is this a case of clamping down on distributors and trying to legitimize the business - or maybe a good ole' fashioned case of trying to remove the evidence of fraudulent claims perpetually made by distributors?

Again, if I were the FTC, I'd be unamused.

Thanks to alert reader Karen for pointing this out.

Disclosure: I am short HLF.

Stocks: HLF