Herbalife will pay $200 million for its sketchy business model

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Herbalife has agreed to make some major changes to avoid being classified as a pyramid scheme.

The company's settlement with the Federal Trade Commission includes a $200 million payment for certain consumers.

The FTC accused Herbalife focusing on bringing new recruits into the company who were deceived into thinking they could earn a substantial income selling diet and nutritional products.

But the FTC said many recruits made little or nothing and some actually lost money.

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Herbalife Ltd. signage is displayed outside of Herbalife Plaza in Torrance, California, U.S., on Monday, Feb. 3, 2014. Herbalife Ltd., the nutrition company hedge fund manager Bill Ackman has accused of being a pyramid scheme, boosted its share buyback by 50 percent to $1.5 billion and announced a $1 billion sale of convertible bonds. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
Orders move on a conveyor belt to be shipped at the Herbalife Ltd. Los Angeles distribution center in Carson, California, U.S., on Tuesday, March 4, 2014. Hedge fund manager Bill Ackman has accused Herbalife of being a pyramid scheme and the company has repeatedly denied Ackman's claims. Herbalife met privately with congressional staff members Feb. 21 to discuss its business practices. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
Boxes of products prepared for shipment sit at the Herbalife Ltd. Los Angeles distribution center in Carson, California, U.S., on Tuesday, March 4, 2014. Hedge fund manager Bill Ackman has accused Herbalife of being a pyramid scheme and the company has repeatedly denied Ackman's claims. Herbalife met privately with congressional staff members Feb. 21 to discuss its business practices. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
Independent distributors browse available products before placing orders at the Herbalife Ltd. Los Angeles distribution center in Carson, California, U.S., on Tuesday, March 4, 2014. Hedge fund manager Bill Ackman has accused Herbalife of being a pyramid scheme and the company has repeatedly denied Ackman's claims. Herbalife met privately with congressional staff members Feb. 21 to discuss its business practices. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
In this Thursday, Feb. 28 2013, photo, a pair of specialists confer at the post that handles Herbalife on the floor of the New York Stock Exchange. Accounting firm KPMG has resigned as the auditor for Herbalife, a dietary supplements maker, and the shoe retailer Skechers after a rogue partner allegedly leaked information about the companies to someone who used it for insider trading. (AP Photo/Richard Drew, FIle)
An employee gathers products for an order at the Herbalife Ltd. Los Angeles distribution center in Carson, California, U.S., on Tuesday, March 4, 2014. Hedge fund manager Bill Ackman has accused Herbalife of being a pyramid scheme and the company has repeatedly denied Ackman's claims. Herbalife met privately with congressional staff members Feb. 21 to discuss its business practices. Photographer: Patrick T. Fallon/Bloomberg via Getty Images
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Now, the company has agreed to restructure its business so it puts a greater focus on retail sales, but it will still be a direct-selling business.

Activist investor William Ackman led the charge against Herbalife and bet $1 billion of his venture capital firm's money against the company's stock, predicting the price would fall dramatically.

But after news of the settlement broke, shares of Herbalife were up as much as 19 percent at one point Friday morning.

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1. Volkswagen

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2. Blackberry

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3. American Apparel 

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4. Cosi

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5. Aeropostale 

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6. Sears

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7. Kobo

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8. Budweiser

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9. Sports Authority

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10. Whole Foods

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This video includes clips from Herbalife

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