Herbalife to pay $123.1-M to settle China bribery case

Multi-level marketing company Herbalife Nutrition Ltd will pay $123.1 million to settle criminal and civil charges for bribing Chinese officials in government agencies and media outlets from 2007 to 2016.

Herbalife will pay $55.74 million in criminal fine, and $67.31 million in disgorgement and interest in a related civil case under the US Securities and Exchange Commission.

According to Acting US Attorney Audrey Strauss, Herbalife approved “extensive and systematic corrupt payments” to Chinese officials, while falsifying records to make its bribes appear as legitimate business expenses.

The company allegedly gave cash, and perks on entertainment, meals, and travel to obtain direct selling licenses, reduce government scrutiny, and suppress negative coverage by state-controlled media.

US Department of Justice said that Herbalife Nutrition entered a three-year deferred prosecution agreement where it admitted conspiring to violate the books and records provision of the anti-bribery law Foreign Corrupt Practices Act.

The multi-level marketing company's products include dietary supplements.

China accounted for 19 percent of Herbalife’s $4.49 billion of net sales in 2016, up from 7 percent in 2006.