Ackman fires off 40 pages of questions aimed at Herbalife

Bill Ackman has a lot of questions for Herbalife — as a matter of fact, 284 of them.

The hedge fund manager fired off 40 pages of questions at the controversial nutrition company that he has called a “pyramid scheme” and is shorting to the tune of $1 billion.

Ackman, the founder of Pershing Square Capital, focused his questions on the lack of clarity about retail sales and product consumption. He also hammered away at the company’s recruiting practices and its much-touted “Nutrition Clubs,” which are forbidden from advertising or selling products.

REUTERS

Bill Ackman

Ackman also brought up some new issues regarding product safety at a manufacturing facility and asked if the company was aware of alleged money laundering through an Herbalife account in Mexico, which was the subject of a published reported a year ago.

The hedge fund activist, who announced his short thesis against Herbalife in detail on Dec. 20, promised to come back to Herbalife with a set of questions after the company refuted his initial claims at a Jan. 17 investor presentation.

“Herbalife executives have repeatedly committed to have a fact-based conversation and total transparency about Herbalife’s business,” said Ackman in introducing his laundry list of questions.

“If the company is committed to ‘total transparency’ as it has claimed, Pershing Square would welcome responses to the following questions.”

Ackman’s latest attack on Herbalife quoted several legal opinions related to the pyramid scheme issue.

He cited a 1986 California injunction that restricts Herbalife from compensating its distributors on anything other than retail sales. But since the company has repeatedly said it doesn’t and cannot track retail sales, Ackman asked, ”How is it possible for the company to be in compliance with the injunction?"

In its Jan. 17 presentation, Herbalife also claimed that most of its distributors buy the product to get a discount for their own consumption and that of family and friends — not to make money.

That would help explain why 88 percent of their US distributors make no money, according to new figures the company released yesterday.

But if that’s the case, Ackman asked: “Why are discount customers required to sign a 48,000-word Distributor Agreement in order to purchase Herbalife products?”

Ackman’s presentation also noted a Federal Trade Commission statement posted on its website Jan. 28 after it shut down Fortune High-Tech Marketing. The statement read:

“If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is mainly based on the number of people you recruit and your sales to them, it’s a pyramid scheme.”

“In light of the above statements by the FTC, does the Company still believe that it can be indifferent to the amount of product sold or consumed within the network versus the amount of sales to independent third parties in the determination as to whether Herbalife is a pyramid scheme?” Ackman asked.

Ackman also asked the company whether it knows if the Securities and Exchange Commission is investigating Herbalife “or any of its affiliates” or if there are any ongoing investigations by Herbalife by any US federal or state agencies or by any foreign regulatory agencies.

The market seemed unimpressed. By midday, Herbalife stock had jumped 2.8 percent to $36.81.

mcelarier@nypost.com

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Miami startup that turns text to video receives $1 million in seed funding

Guide, a new technology startup based in Miami, announced Tuesday it has closed a $1 million round of seed funding from investors including the John S. and James L. Knight Foundation, Sapient Corp., MTV founder Bob Pitman, actor and producer Omar Epps, and early Google employee Steve Schimmel. The Knight Foundation is supporting Guide through its new early-stage venture fund, the Knight Enterprise Fund.

Led by CEO and founder Freddie Laker and COO Leslie Bradshaw, Guide’s team of seven is focused on turning online news, social streams and blogs into video for users who may be cooking, exercising, commuting or getting ready in the morning. The free application offers consumers a selection of about 20 “anchors” — including a dog, a robot and an anime character — that will read the article and present the accompanying photos, pull-out information and video clips in its video presentation. Revenue drivers for Guide could include in-app purchases, advertising-based anchors and customizations from publishers, said Laker, a former vice president at SapientNitro.

Laker and his team plan to launch a public beta next month, which they plan to do with a splash at the huge technology conference South by Southwest (SXSW) in Austin, Texas.

Read more about Guide here on the Starting Gate blog. Follow Nancy Dahlberg on Twitter @ndahlberg

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Miami U.S. attorney issues warning and crackdown on ID theft, tax-refund fraud

Guard your identity with your life, warns South Florida’s top law enforcement official.

U.S. Attorney Wifredo Ferrer says the double whammy of ID theft and tax-refund scams are the “new Medicare fraud,” picking the pockets of hard-working people and the federal government every year for billions of dollars.

“We need to protect our personal identities as best we can,” Ferrer told The Miami Herald. “One of the best ways to protect yourself is to file your tax returns as early as possible to beat the criminals to the punch.”

The Miami area, infamous for its smorgasbord of fraud schemes, is among the worst spots for what he described as an “epidemic” ID-theft crime wave. To drive home his point at the height of the tax season, Ferrer’s office unveiled the latest prosecutions of 14 defendants in a variety of tax-refund rackets.

Among them: Yet another case of a South Florida hospital employee swiping patients’ Social Security numbers and dates of birth to defraud the Internal Revenue Service.

According to an indictment filed in January, Boca Raton Regional Hospital scheduler Shalamar Major, 32, of Deerfield Beach, stole the personal information of patients and supplied the data to Tanisha Wright in exchange for a split fee for every successful false return submitted to the IRS.

Wright, 27, of Fort Lauderdale, is accused of filing the returns electronically and getting the IRS to direct-deposit the refunds on pre-paid reloadable debit cards, so she could make withdrawals at ATMs or retail purchases. In total, she filed 57 returns seeking $306,720, according to the indictment.

Other prosecutions include:

•  In an IRS undercover sting last month, Nael Dawud Sammour, 52, was charged with theft of public money after he tried to cash 75 fraudulently obtained tax-refund checks totaling $750,369, according to an indictment. Sammour was arrested after he allegedly used counterfeit driver’s licenses and Social Security cards to cash the refunds through IRS agents posing as check cashers. Agents seized $30,128 from him.

•  Two other defendants, Fednol Pierre, 34, of Miami, and Jeanson Pata, 31, of West Palm Beach, were charged in January with stealing government funds and aggravated ID theft involving six fraudulent refunds totaling $52,535.

•  Last week, five defendants — Jeffrey Andre Young Jr., 31, of Miami, Joseph Bshara, 27, of Miami Shores, Siham Benabdallah, 23, of Miami Shores, along with Douglas Michael Young, 41, and Nicole Young, 42, owners of two Miami tax preparation companies — pleaded guilty to a fraud conspiracy involving $37,749 in cashed refund checks.

Perpetrators in South Florida, Tampa and other regions of the country steal the identities of people who don’t file income tax returns in order to avoid having the IRS detect duplicate filings, authorities say. They also swipe people’s IDs to file phony tax returns. Combined, the schemes have robbed the U.S. government of billions of dollars yearly since the crime began spreading in 2008, according to a Treasury Department report.

South Florida victims of these and similar crimes run the gamut: police officers, Holocaust survivors, U.S. Marines stationed in Afghanistan, school children, hospital patients and senior citizens.

What’s fueling the fraud? Florida has the highest rate of identity theft in the country, with 178 complaints per 100,000 residents last year, followed by Georgia, with 120 complaints per 100,000 residents, according to the Federal Trade Commission.

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Exclusive: D23 Magazine Rachel Weisz in 'Oz the Great and Powerful'

Disney's Oz The Great and Powerful lands in theaters March 8, and along the yellow brick road Disney's spring issue of Disney twenty-three magazine has plenty of lollipop details about the incredible production. We have a sneak preview, plus an exclusive image of Rachel Weisz from the article!

Pics: Stars on the Set!

"I thought it would be really fun to be bad, to be wicked," says Weisz of what drew her to play the witch Evanora, whose headdress was designed to give her the look of a bird of prey.

The flagship magazine of D23: The Official Disney Fan Club hits stands February 12 with an exclusive tour of the Land of Oz in the cover story A Great and Powerful Odyssey.

The feature article includes interviews with Weisz, Michelle Williams and Zach Braff and behind-the-scenes craftsmen about working on the magical Sam Raimi film on soundstages in Pontiac, MI. Details include the thought process behind the 50/50 split between real and virtual sets, such as the giant tea kettles of China Town's teacup village, and how the Deco-style architecture of Emerald City is a completely original take on designs inspired by Hugh Ferriss (the highly influential delineator whose look inspired Batman's Gotham City and many real-life architects).

Video: Watch the 'Oz The Great and Powerful' Trailer

The new Disney twenty-three also has a sneak peek of 2014's Maleficent starring Angelina Jolie, and continues the Oz theme with Emerald City fashions, a great story detailing Walt Disney's early attempts to bring Oz to the big screen, plus a fond, full-color look back at Disney's Return to Oz from 1985, a stunning film with incredible production design that was sadly overlooked at the box office at the time of its release, but now is considered a cult classic.

The mag also celebrates the 15th anniversary of Disney's Animal Kingdom, concept art from November's upcoming Disney movie Frozen in Time, and much more.

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Cop's tweets proved right after 2 parolees arrested again for crimes in B'klyn

Eduardo Guzman, left and Efrain Gauthier, right.

He was right.

A Brooklyn captain who took heat for using his Twitter account to warn the public about the release of parolees in his command was on to something -- two career criminals he tweeted about were recently cuffed again for crimes in Brooklyn.

Captain Jeffrey Schiff, the commanding officer of the 76th precinct, had tweeted about the release of parolee Eduardo Guzman, as well a criminal wanted for grand larceny in his command.

Guzman, 39, was arrested on Jan. 24 for stealing women’s clothing from a Carroll Gardens apartment building, Schiff said at a recent community council meeting.

A cop spotted him pushing a shopping cart with women’s garments wrapped in plastic, and a woman’s name and address on it about 12:30 p.m. Jan. 24, court papers state.

He was charged with petit larceny and criminal possession of stolen property.

Schiff had also tweeted about Efrain Gauthier, who was wanted for grand larceny, and said at the meeting that police had cuffed him in Bay Ridge.

Gauthier was arrested on Jan. 24 for speeding down a sidewalk on 8th Avenue and 70th Street in a bike while holding onto a second bicycle, according to court papers.

When he was arrested, police found a pipe with crack cocaine and a hypodermic needle in his bag. He allegedly told cops that they were the leftovers from the day before, when he was shooting up heroin, court papers state.

He was charged with disorderly conduct, criminally possession of a hypodermic instrument, possession of burglar’s tools and operating a bicycle on the sidewalk.

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Can’t find time for play? Try scheduling it

If your resolutions for 2013 include achieving a better work-life balance, your calendar holds the key to your success.

But, to pull off your goals, you’re going to need to turn the traditional way of thinking upside down.

Most people schedule their work commitments on their calendars and squeeze in family, friends and fun around it. Instead, schedule your work around your personal life, say Michelle Villalobos and Jessica Kizorek, speakers, personal branding consultants and co-creators of Make Them Beg, a professional self development program. For example, they suggest you block out gym time, reading for pleasure time, coaching your kid time and date night. Even a person with almost no flexibility in his or her work schedule can block out 15 minutes for a walk rather than eating lunch at their desks.

“You have to plan for play. Otherwise work expands and there’s no time for play,” Kizorek says. Today, it’s easy to stay a little later at the office or work through lunch because there’s always more to do. Using your calendar effectively can help you with boundaries.

Villalobos says once you put “play” into your schedule, it helps to get people who are important in your life to keep you committed. For example, she blocks out three hours twice a week on her calendar to paint. She has asked her boyfriend to help her stick to that schedule.

Realistically, there will be times when you have to reschedule a fun activity because of work demands. “At least you know what you missed so if you don’t do it, you move it to another day,” Villalobos says.

If you’re in a relationship, experts advise letting your partner participate in creating your calendar. A friend of mine sends his spouse an electronic invite to his poker night signaling that she has the night free to schedule her own fun activity.

Scheduling everything may seem rigid. “That’s the opposite,” Villalobos insists. “By putting things on your calendar, you can focus on what you need to do in the moment. It allows you to be far more present.”

With more people converting to electronic calendars or hovering between paper and online options, how we coordinate our schedules is in flux. But for balance, it’s often better to track personal and professional in one place.

Sharon Teitelbaum, a Boston-based work-life coach, says to calendar all important life events including birthdays. It may sound like common sense to calendar your son’s birthday, but people forget and schedule business travel, she has found. She also advises putting work events in your calendar as far in advance as possible and tasks that lead up to them. “You don’t want to agree to host a dinner party the weekend before a work retreat.”

For many busy people, the traditional way of scheduling needs to change from calendaring a due date to creating a timeline. If you have a big project you need to have completed by Feb. 15, Teitelbaum says break it into weekly tasks leading up to that date. “People vastly underestimate how long things take and the number of interruptions they have to contend with,” she says.

Julie Morgenstern, who created the Balanced Life Planner for Delray Beach-based specialty retailer Levenger, says that even on a daily basis people don’t plan realistically. “By bravely recognizing the limits of each day and how long each to-do on your list will take, we can see in advance what will or won’t fit into our calendar, and become more strategic,” she said.

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International Noise Conference celebrates its 10th anniversary at Churchill’s Pub

Frank Falestra is standing at the backyard bar of Churchill’s Pub, tinkering with a lighting board that has a broken switch.

It’s an urgent repair because the switch controls red light.

“Red is important at a rock bar,” he says.

Falestra, better known as Rat Bastard, is hailed as the godfather of Miami’s noise scene and the founder of International Noise Conference, an annual festival celebrating musical nonconformity.

Every year, the festival draws hundreds to three-decades-old Churchill’s Pub, where noise fans and other revelers gather to sing, dance, screech and, sometimes, bloody each other’s noses.

International Noise Conference will kick off its 10th year starting 10 p.m. Wednesday at Churchill’s, 5501 NE Second Ave. The festival continues at 9 p.m. Thursday, 8 p.m. Friday and 3 p.m. Saturday.

Falestra, 54, expects more than 100 bands to show up. That number is about the same as the last few years, but the fourth night of the festival is new, thanks to funding from the Knight Foundation’s Knight Arts Challenge.

Admission to the festival, as always, is free.

“We keep the money thing completely out of it,” Falestra said. “That’s probably why it’s still going.”

There are only two hard-and-fast rules for musicians performing at INC: no laptops, and get off the stage in 15 minutes or less.

The laptop rule is to prevent the show from getting boring, Falestra says.

But the time limit? Artists have flown all the way from France and Australia to perform at INC. And they only get 15 minutes?

According to Falestra, a 30-year veteran of the Miami music scene, that’s all you need to get the point across.

“Usually 20 minutes of anybody is too much,” he said. “Like the Foo Fighters. You wouldn’t want to see them for 20 minutes. Ten minutes would kill you.”

Page 27, a Denver-based noise band, has one of the farthest commutes on the set list this year. Like most of the other bands, INC is the only show pulling Page 27 away from its hometown this time of year.

But member John Gross, 35, said the band is looking forward to the networking opportunities as much as the brief set. The best part for him, he said, is going to the tables in the back of the bar to trade CDs, tapes and records with other bands. “You end up finding a lot of music that you don’t see anywhere else,” Gross said.

The first two days of the festival, which feature local bands almost exclusively, are heavy on different music genres. Thursday is usually the most outrageous night. Sometimes, Falestra says, people get naked.

Many of the bands will play noise sets regardless of their typical musical style. This might include an avant-garde mix of improvisational drumming, playing non-musical objects such as sheets of glass or screaming into a microphone.

Novice noise fans shouldn’t be afraid, though. In spite of its name, INC doesn’t require that every set consist of noise. It’s possible to hear something approaching listenable music at the show.

Although he disdains the pop-punk bands that flood college radio stations these days (he has a particular distaste for Green Day), Falestra said he’s not averse to tossing more mainstream acts into the lineup to keep things from getting predictable.

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Adorable Tots: Celebs and their Cute Kids!

Rosie O'Donnell

Rosie O'Donnell cradles her daughter Dakota in this intimate Instagram pic, in which she also sings the praises of her new baby carrier. "NuRooBaby.com -- a wonderful baby carrier -- with skin on skin contact -- love it," she writes. 

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Alleged SoHo firebug 'stressed from jealousy' lawyer claims after man pleads not guilty to setting fatal blaze

Steven Hirsch

Wei Chu Hu pleaded not guilty today to setting a blaze on Jan. 11 in SoHo that left one woman dead and destroyed the homes of numerous other residents.

He was "stressed," the Manhattan man accused of setting a deadly SoHo fire last month -- out of jealousy -- explained afterward.

"He said he burned a building down because he was stressed about family matters," police detectives said of the confession of accused killer arsonist Wei Chu Hu, 45.

"He said nobody got hurt to his knowledge," according to the confession, released today as Hu pleaded not guilty in Manhattan Supreme Court to the Jan. 11 blaze at 41 Spring Street, which left a young newlywed woman charred and lifeless on a third floor fire escape.

"He said he believed his wife was having an extramarital sexual relationship and that he and his wife got into an argument about this and she left the building with their son," the confession notes, recorded early the next morning by Fifth Precinct detectives.

Hu also admits starting the fire using a lighter -- first igniting the bedding in his wife and son's bedroom, then the bedding in his own bedroom -- and then fighting with first responders to keep them from entering the building.

"When a detective asked him how he felt about what he had done, defendant said he really didn't care either way and that he had no hard feelings," the confession continues.

Stephen Yang

The back of 41 Spring Street after a fire ripped through the building.

Hu made additional statements that were videotaped by prosecutors but not released. He remains held without bail.

"We're trying to find out to what extent there is a viable psychiatric defense," his lawyer, Kevin Walsh, said after court. Hu's records were destroyed in the fire; the lawyer said he is in the process of retrieving additional health documents from China.

Manhattan Supreme Court Justice Charles Solomon set April 2 for Hu's next court date.

"A woman died without warning as a result of the destructive, callous actions for which the defendant stands accused," Manhattan DA Cyrus Vance said in a written statement issued after the arraignment.

"As a result of this fire, none of the building's residents have been able to return to their apartments and many lost a lifetime of belongings," he said.

"Many more neighbors could have been injured or had their homes destroyed if not for the swift and courageous work of the FDNY and NYPD, who put their lives on the line that night," he added.

Stephen Yang

The back of 41 Spring Street after a fire ripped through the building.

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Cutting edge tech from Swiss Army

The Victorinox Swiss Army Jetsetter looks like a traditional pocket knife the company is famous for, but instead of the knife you get a pocket full of storage.

A foldout and detachable USB 2.0 flash drive is among the features in the mini tool kit, which includes a ball point pen, bottle opener, Phillips screwdriver, tweezers and scissors in the 16 GB model I tested out.

The detachable flash drive is Windows- and Mac-friendly, although it comes loaded with Mac-friendly security software to protect your data stored on the device.

It’s available in capacities of 8 GB black ($39.95), 16 GB red ($49.99) and 32 GB silver ($99.99). There are a few different features in each, with the 32 GB model having a LED mini light, for example.

Details: www.swissarmy.com

A great find

Kensington’s Proximo Fob and Tag Kit creates a wireless (Bluetooth) monitoring system between your keys, accessories and an iPhone (4S or 5) that will alert you if they are separated.

I tried the starter kit ($59.99), which includes a fob, tag, keyring and has a screen driver to open the hardware and insert the included CR2032 lithium coin batteries, along with a key ring.

The fob attaches to the key ring and after you have it linked with the free Kensington Proximo app, anytime the devices are separated an alarm sounds. If your phone is within range but you can’t find it, press a button.

It’s easy to think of this as a monitoring device for your expensive smartphone but it also works in reverse once everything is linked up. With your phone in your pocket or purse, it can alert you that you have left your keys behind.

can be placed in a computer bag or attached to anything (or anyone) that you want alarmed. But unlike the fob, it’s only one direction; the app will find it but you can’t use it to find your phone.

The Proximo App Dashboard tracks up to five items with a single fob and up to four tags. Additional tags cost $24.99 each.

If you get out of range between the devices, an app lets you tap a button to let you know where your device was last seen and even pulls up a map with a specific address.

Details: www.Kensington.com

Sound investment

RadioShack’s Auvio expanding Bluetooth speaker ($39.99) is as simple and useful as a gadget can be. Just twist open the speaker, pair it with your device via Bluetooth and you’ll be amazed at how much better the sound is than the built-in speaker on your smartphone or tablet.

A rechargeable battery is built in for up to eight hours of use and can be powered up in two hours with a USB charge using the included cable.

It is 2.5 inches in diameter, just over 3-inches tall when expanded and about 2.5 inches when closed.

Another choice, with a bigger size (2.8-by-6.5-by-2.9 inches) but much better sound is the brick-shaped Auvio Portable Speaker ($79.99).

Both speakers have aux-in ports to connect to non-Bluetooth devices.

Details: www.radioshack.com

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