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Issues To Consider From The Enforcement Action Against Former Herbalife China Executives

By on November 20, 2019 in Herbalife, Hongwei Yang, Internal Controls, Obtain or Retain Business, Yanliang Li
Issues

This prior post detailed the DOJ’s recent criminal indictment against Yanliang Li (a citizen of China and former Managing Director of a Chinese division of Herbalife) and Hongwei Yang (a citizen of China and former head of the External Affairs Department of a Chinese division of Herbalife). Yang was charged with one count of conspiracy to violate the FCPA and Li was charged with one count of conspiracy to violate the FCPA, one count of perjury and one count of destruction of records in a federal investigation. In addition, the SEC charged Li with violating the FCPA’s anti-bribery provisions and aiding and abetting books and records and internal controls violations.

This post highlights additional issues to consider from the enforcement action.

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Former Herbalife China Executives Criminally Charged By DOJ, SEC Also Charges Former Executive

By on November 15, 2019 in 2019 Enforcement Actions, Anything of Value, China, DOJ Enforcement Action, Executive Enforcement Action, Foreign Nationals, Herbalife, Hiring Family Members of Foreign Officials, Hongwei Yang, Individual Enforcement Action, Permits / Licenses / Customs / Tax, SEC Enforcement Action, Yanliang Li
herbalife

In 2014, Avon resolved a Foreign Corrupt Practices Act enforcement based in large part on obtaining a direct selling permit in China. (See here for the prior post).

In 2016, Nu Skin Enterprises resolved an FCPA enforcement action based in large part on obtaining a direct selling permit in China. (See here for the prior post).

In 2017, Herbalife disclosed that it was under FCPA scrutiny concerning its conduct in China. With the company’s scrutiny still pending, yesterday the DOJ announced that Yanliang Li (a citizen of China and former Managing Director of a Chinese division of Herbalife) and Hongwei Yang (a citizen of China and former head the External Affairs Department of a Chinese division of Herbalife) were criminally charged “for their roles in a scheme to violate the anti-bribery and the internal controls provisions of the FCPA.” Not surprisingly, the alleged conduct focused on obtaining a direct selling permit.

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