Company linked to Joan Freeman funder paid $200m settlement

A company involving a major funder of presidential candidate Joan Freeman’s campaign paid a $200 million settlement to reimburse investors after accusations that it was operating like a pyramid scheme.

Des Walsh, an Irish businessman living in Los Angeles, and a friend of Ms Freeman, has provided her with a loan of €120,000 to finance her campaign.

Ms Freeman’s campaign says it is “a loan, not a donation, and will be paid back in full”. The loan is in full compliance with Sipo guidelines, her spokeswoman said.

Mr Walsh was president of Herbalife, which describes itself as a “global nutrition company”. He is currently executive vice-chairman, according to US company filings.

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The company paid $200 million to settle charges brought by the Federal Trade Commission (FTC), a US government consumer protection body, and agreed to restructure its US business operations.

According to the FTC complaint, the company’s “compensation structure was unfair because it rewards distributors for recruiting others to join and purchase products in order to advance in the marketing programme, rather than in response to actual retail demand for the product”.

‘Quit their jobs’

The FTC said that Herbalife claimed “that people who participate can expect to quit their jobs, earn thousands of dollars a month, make a career-level income, or even get rich.

“But the truth . . . is that the overwhelming majority of distributors who pursue the business opportunity earn little or no money.”

Ms Freeman’s campaign declined to comment last night, while Herbalife also did not return a message.

Yesterday saw the opening shots fired between candidates in the presidential election, with four of the six contenders participating in a debate on RTÉ radio. President Michael D Higgins and Seán Gallagher did not attend.

The four candidates to take part were Sinn Féin MEP Liadh Ní Riada, Ms Freeman, and businessmen Gavin Duffy and Peter Casey.

During the debate, Mr Duffy said he would take the full presidential salary of €325,000 if elected. He was worried about Mr Casey’s suggestion to give it to charity as then in future it would suggest only people like Mr Casey could afford to be president.

Salary

Mr Casey said he believed there should be a salary, but not one as large as it is, or as large as Mr Duffy wanted it to be.

Ms Freeman called for full disclosure surrounding the the unaudited presidential allowance of €317,000. She said she would take the salary, but then donate money to projects, adding that she had done so with her Seanad salary.

Ms Ní Riada said she would take a €160,000 ministerial salary. The rest would return to the Exchequer.

President Higgins’s spokesman said the president had been “constrained” from taking part in yesterday’s debate due to pre-existing diary commitments.