...Herbalife, which sells nutritional supplements through a network of distributors, was already under considerable scrutiny. The hedge fund manager William A. Ackman claimed late last year that the company was an illegal pyramid scheme...The linked story is itself the problem. At what point did business writers start treating multi-level marketing operations as legitimate businesses?
Capitalism and the Free Market are given a bad reputation by ethically questionable "companies" like these, and make easy targets for regulation arguments too.
Let me be clear on a principle: fraud is not capitalism. I'm not accusing anyone of committing fraud, I'm simply stating that libertarianism and enforcement of theft laws are fully compatible.
Libertarians do not condone violence (and theft is a form of violence against property), and this view remains consistent for individuals, small companies, or massive banks via humongous tax-funded bailouts.
We don't need new regulations, but merely enforcement of our laws. Also, for fun, here's the Penn & Teller: Bullshit! episode about the matter:
UPDATE: Pyramid Scheme Alert is good resource for checking out potential "opportunities."