It's Barry Minkow vs. Herbalife
You may remember Barry Minkow as the young San Fernando Valley entrepreneur who was convicted of defrauding investors of millions of dollars in his ZZZZ Best carpet-cleaning company. That was twenty years ago. Minkow is now a born-again fraud fighter (and pastor) who lives in San Diego. The most recent target of his Fraud Discovery Institute is nutritional supplements company Herbalife.
In response to Minkow's investigations, the Los Angeles-based company has been on the defensive lately. In late April, company president Gregory L. Probert resigned after Minkow's firm discovered that the executive did not earn an MBA has he had claimed. Last month, Herbalife was busy rebutting lab tests Minkow claimed showed high levels of lead in some of its product.
Herbalife's stock sunk in light of these developments, which could benefit Minkow, reports the Los Angeles Business Journal (subscription required). Minkow says he has shorted the company's stock (meaning he would benefit if the shares fell) and that he has given the FBI and Securities Exchange Commission access to his online trading accounts. Shorting the stock is his way of financing his ongoing probe into the company, he said.
“Why am I good at what I do? I’m a liar and a thief,” said Minkow, who was in town last week working on a deal for a possible TV pilot based on his life story. “I think in the same way as the people I go after.”
-- Jesus Sanchez
Photo: Associated Press