WASHINGTON -- Federal regulators said Friday that they planned to crack down on misleading advertisements for weight-loss products, including dietary supplements, food additives and skin creams.
Jessica Rich, director of the Federal Trade Commission’s Bureau of Consumer Protection, will hold a news conference Tuesday to announce an “initiative against deceptive claims made by national marketers of fad weight-loss products,” the agency said.
No additional information was provided.
The announcement caused shares of nutritional product makers Herbalife and Nu Skin Enterprises to drop Friday.
Herbalife stock fell as much as 5% before recovering to close down 3.4% at $77.09. The Los Angeles company has been under fire for about a year since hedge fund billionaire Bill Ackman made highly publicized accusations that it was a pyramid scheme.
Some consumer and civil rights groups have asked the Federal Trade Commission to investigate Herbalife. The company has said in regulatory filings that it is cooperating with a Securities and Exchange Commission probe.
Herbalife said Friday that it had no indication it was targeted in the latest FTC initiative.
“Herbalife has no reason to think any of its weight-management products will be the subject of the FTC’s January 7 press conference,” the company said. “Herbalife uses sound science in assessing those products and conveys substantiated claims for them in a non-deceptive manner."
Shares of Nu Skin were down about 6.7% in midday trading Friday before also recovering some of the losses. The stock closed at $132.41, a drop of 4.1%.
A Nu Skin spokeswoman did not immediately respond to a request for comment.