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Showing posts from May, 2014

Overstock.com CEO Patrick Byrne Spying on People--Again

Fresh off the heels of a California Judge imposing a $6.8 million judgment against Overstock.com (NASDAQ: OSTK) for false advertising and unlawful business practices, the company is in trouble again. This time a class action complaint alleges that employees of the company cold called the cell phone numbers of prospective customers seeking to sell them insurance, secretly recorded those conversations without their permission, and deceitfully obtained "highly personal and private information." [Download Complaint]

According to the complaint:

Plaintiff alleges that Defendant [Overstock.com] continues to violate Penal Code § 632.7 by impermissibly recording its telephone conversations with California residents while said residents are on cellular telephones.
The complaint further alleges that:

9. On or about March 12, 2014, Plaintiff received a telephonic communication from Defendant on Plaintiff’s cellular telephone. During the conversation, Defendant attempted to solicit Plain…

On Twitter, Herbalife Uses "Herbalife Truth" To Tell A Lie

One of the main concepts I teach about financial crimes is that fraudsters seek to create false images of stature and integrity in an effort to gain the trust of their potential victims. Apparently, Herbalife (NYSE: HLF) is employing the same playbook used by fraudsters in an effort to create a phony image for itself.

Last week, the company claimed to be an "American made company" on a twitter account called "Herbalife Truth" which was created to counter allegations by Bill Ackman that it is running an illegal pyramid scheme. However, the cover page of Herbalife's 10-K report states plainly that its principle executive offices are located in Grand Cayman, Cayman Islands. Many of Herbalife's manufacturing facilities and its contract manufacturers are located outside the United States. See Herbalife's tweet and my response below (click on image to enlarge):




Originally, I wasn't sure whether to even write about this issue because it's totally irrel…