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Herbalife, Nu Skin shares plunge over fears of Chinese crackdown

Bloomberg Published on Tue, Aug 15, 2017 / 5:00 PM GMT+8

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NEW YORK (Aug 15): Shares of Herbalife, Nu Skin Enterprises and USANA Health Sciences tumbled on Monday over concerns that Chinese regulators will crack down on the companies’ marketing practices.

Herbalife plunged as much as 7.8% to US$60.71, marking the biggest decline in more than two months. Nu Skin fell 9.6% to US$54.68, while USANA declined 10% to US$52.85.

The rout followed a statement posted on China’s State Administration for Industry & Commerce website announcing a three-month campaign to police pyramid schemes. Though the agency didn’t name the companies, Herbalife and other so-called multilevel-marketing businesses have faced allegations that they use a pyramid sales model. Herbalife settled a case with the Federal Trade Commission last year that reined in its practices in the US