Nature’s Sunshine sued in class action

by louabbott on November 21, 2006

Daily Herald – November 21, 2006

Nature’s Sunshine Products Inc. and three executives are embroiled in a class action that alleges they falsified financial statements to its auditors and federal regulators — costing shareholders millions of dollars in damages.

Five shareholders sued Nature’s Sunshine, its president and CEO Douglas Faggioli, former CFO Craig Huff and Franz Cristiani, former chairman of the audit committee, in a consolidated class action lawsuit filed earlier this month in U.S. District Court in Salt Lake City.

Steven Anreder, spokesman for Nature’s Sunshine, said the company has hired an attorney and plans to “vigorously defend against this lawsuit.”

The defendants are accused of filing misleading Sarbanes-Oxley Act certifications, Form 10-Q quarterly earnings reports and press releases with the U.S. Securities and Exchange Commission to illicit “clean” audit reports from its former auditor, KPMG LLP. The defendants haven’t been charged with any criminal violations to date.

“Typically, class actions don’t put companies out of business. It’s designed to compensate shareholders for the alleged fraud,” said Phillip Kim, lead counsel for the plaintiffs, with the Rosen law firm in New York. “The company also voluntarily stated in SEC filings it had engaged in illegal activities related to the financial statements and that these illegal activities are serious enough to warrant notifying government authorities like the SEC and the Department of Justice.”

Read the entire article at the Daily Herald

Also, read our company overview:  Nature’s Sunshine Facts, News and Review

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