Herbalife Says KPMG Resigns as Auditor Amid Allegations
Herbalife Ltd. (HLF) said KPMG LLP resigned as its independent accountant after finding that a partner allegedly was involved in insider trading in the nutritional-supplements company’s shares.
The resignation is because KPMG concluded its independence had been compromised and wasn’t related to Herbalife’s financial statements, accounting practices or its management’s integrity, Cayman Islands-based Herbalife said today in a statement. The change is effective immediately.
KPMG said in a statement on its website that it was resigning from two clients after finding that the partner in charge of its audit practice in Los Angeles was involved in providing non-public client information to a third party. The firm said it has no reason to believe the companies’ financial statements were materially misstated.
Herbalife shares, which were halted pending the announcement, had gained 17 percent this year through yesterday, compared with a 9.6 percent gain for the Standard & Poor’s 500 Index.
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