Consumer Health Digest #16-28

Your Weekly Update of News and Reviews
July 24, 2016

Consumer Health Digest is a free weekly e-mail newsletter edited by Stephen Barrett, M.D., with help from William M. London, Ed.D., M.P.H. It summarizes scientific reports; legislative developments; enforcement actions; news reports; Web site evaluations; recommended and nonrecommended books; and other information relevant to consumer protection and consumer decision-making.

Herbalife to pay $200 million to settle FTC charges. Herbalife International of America, Inc., Herbalife International, Inc., and Herbalife, Ltd. have agreed to restructure their U.S. business operations and pay $200 million to settle FTC charges that they deceived consumers into believing they could earn substantial money selling diet, nutritional supplement, and personal care products. [Herbalife will restructure its multi-level marketing operations and pay $200 million for consumer redress to settle FTC charges. FTC news release, July 15, 2016] The settlement was announced at a videotaped press conference at which FTC chairwoman Edith Ramirez answered questions about the case. Her opening statement noted:

In response to the settlement, Carl Icahn (an Herbalife board member and major shareholder) stated that the FTC had "concluded that Herbalife is not a pyramid scheme." However, Ramirez said that was inaccurate, that the settlement made no such determination but focused on correcting Herbalife's improper practices.

Huge Medicare scheme uncovered. Phillip Esformes, who owned many Miami-area skilled nursing and assisted living facilities; Odette Barcha, a hospital administrator; and Arnaldo Carmouze, a physician assistant, were charged with conspiracy, obstruction, money laundering and health care fraud in connection with a $1 billion scheme that involved many Miami-based health care providers. [Three individuals charged in $1 billion Medicare fraud and money laundering scheme. USDOJ news release, July 22, 2016] The indictment alleged:

Court documents indicate that in 2006, Esformes paid $15.4 million to resolve a civil fraud case that involved unnecessarily admitting patients from his assisted living facilities into a Miami-area hospital.

Barrett interview podcasted. The Americans for Science Blog has posted a 50-minute podcast in which Dr. Stephen Barrett describes how he became interested in fighting quackery, a wide range of problems he has encountered, why people are vulnerable, and important components of our society that are failing to take protective action.

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This page was posted on July 25, 2016.