Nutritional supplement and weight management company Herbalife Ltd. (NYSE:HLF) on Wednesday dismissed as baseless the latest claims about its allegedly deteriorating and fraudulent business practices, made by hedge fund manager Bill Ackman.

In his latest letter to Pershing Square Capital Management LP shareholders, Ackman reiterated his criticisms of Herbalife, despite its successful recent share upticks and earnings, which significantly beat market expectations.

In updating investors about his total hedge fund portfolio, Ackman describes Herbalife as one major well-known company, aside from a handful of bond and mortgage insurers, that he is actively shorting. Shorting is a technique that benefits an investor if a security loses value.

In particular, Ackman cites the departures of top Herbalife distributors -- two left earlier this year, and another reportedly committed suicide in August -- as signaling a decline in Herbalife’s business.

Herbalife’s operating income inched up by only 3 percent in the latest quarter, wrote Ackman, and serious questions about the safety and quality of its products have surfaced from whistle-blowers.

“We believe Herbalife’s business fundamentals have just begun to be negatively impacted by top distributor departures and various distributor rule changes,” wrote Ackman.  

But Herbalife branded Ackman’s ongoing campaign as increasingly desperate and said none of his claims hold merit.

“For the past eight months, Mr. Ackman has executed an unfounded and relentless public attack on Herbalife’s business model,” said a company spokesman in an email to International Business Times.

“He has also hired well-connected Washington lobbyists and PR firms to try to make a case that the facts clearly do not support. His campaign is increasingly taking on an air of desperation.”

Ackman’s chief and most serious allegation, unveiled at a December 2012 investor conference, is that Herbalife is basically an illegal pyramid scheme, victimizing the direct distributors who sell its products.

Ackman has tried to draw regulatory attention to Herbalife, which is facing an ongoing Securities and Exchange Commission inquiry.

In his letter, Ackman hints that the Federal Trade Commission could investigate the company in the future but adds that it’s unclear if the FTC has already initiated an investigation.    

According to the latest estimates, Ackman’s $1 billion initial short position in Herbalife has lost him about $300 million so far.

Not all high-powered investors share Ackman's view of Herbalife; fellow billionaire Carl Icahn has backed Herbalife since early this year.