Contact Information: Contact: Jean Bono Natural Health Trends Corp.
Natural Health Trends Announces Completion of SEC Investigation With No Enforcement Action Taken Against the Company
SEC Settles Civil Action Against Former Officers
| Source: Natural Health Trends Corp.
DALLAS, TX--(Marketwire - September 15, 2008) - Natural Health Trends Corp. (NASDAQ : BHIP ), an
international direct-selling and e-commerce company, announced today that
the Securities and Exchange Commission has completed a previously disclosed
investigation of the Company and others that was initiated in October 2006.
The SEC's staff notified the Company by letter dated September 12, 2008,
that they do not intend to recommend any enforcement action against the
Company.
The investigation did result in a civil enforcement action by the SEC
against two former officers of the Company, Mark Woodburn and Terry LaCore,
who were charged with securities fraud and other violations arising from
undisclosed related party transactions. Mr. Woodburn is a former president,
director and chief financial officer of the Company, and Mr. LaCore is a
former director of the Company and the former chief executive officer of
NHT Global, Inc., a subsidiary of the Company. In late 2005, Mr. Woodburn
and Mr. LaCore resigned as officers and directors, and the Company
terminated their employment, in connection with an independent
investigation by the Company's Audit Committee.
The SEC's complaint against Woodburn and LaCore alleged that they had
received approximately $2.5 million in undisclosed payments from the
Company's top distributor from 2002 through August 2005. The complaint
also alleged that Woodburn took steps to conceal the related-party nature
of a loan he caused the Company to make to a family-controlled entity when
the loan was discovered by the Company's new accounting management in the
fall of 2004. The complaint alleged that the activities of Woodburn and
LaCore resulted in the Company's failure to disclose, or adequately
disclose, the related party transactions in periodic filings, registration
statements, and proxy statements.
On September 4, 2008, the SEC announced that Woodburn and LaCore agreed to
settle the SEC's charges without admitting or denying the allegations of
the complaint. Woodburn and LaCore each agreed to be permanently enjoined
from violating certain anti-fraud and other securities laws and to a
five-year officer and director bar. In addition, Woodburn and LaCore each
agreed to pay a monetary civil penalty.
"Current management of the Company worked diligently to fully cooperate
with the SEC in its investigation," said the Company's President, Chris
Sharng. "We are pleased that no enforcement action has been recommended
against the Company, and we look forward to continuing to focus on our
business with this investigation behind us," added Mr. Sharng.
About Natural Health Trends
Natural Health Trends Corp. is an international direct-selling and
e-commerce Company operating through its subsidiaries throughout Asia,
North America, and Europe. The Company markets premium quality personal
care products under the NHT Global brand. Additional information can be
found on the Company's website, and management encourages interested
parties to register for updated corporate information via email on the
Company's home page, www.naturalhealthtrendscorp.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995 -- Forward-looking statements in this release do not constitute
guarantees of future performance. Such forward-looking statements are
subject to risks and uncertainties that could cause our actual results to
differ materially from those anticipated. Such risks and uncertainties
include the risks and uncertainties detailed under the caption "Risk
Factors" in our Annual Report on Form 10-K filed on March 31, 2008, with
the Securities and Exchange Commission. We assume no obligation to update
any forward-looking information contained in this press release or with
respect to the announcements described herein.