Thursday, October 11, 2012

Revealed: Facebook 'gave officials inflated estimates of the number of its users' just a week before disastrous IPO

Facebook was caught out providing U.S. Securities and Exchange Commission officials inaccurate and inflated estimates of the number of its users and ultimately its worth just a week before the company's disastrous IPO, it emerged today.

A flurry of 12 letters between the U.S. Securities and Exchange Commission (SEC) and Facebook depict a reluctant management team repeatedly playing cat-and-mouse over official requests to release figures and in the end being forced to withdraw information that was in reality guess work at best.

Most damning is the suspicion that Facebook did not have accurate figures for the number of smartphone users who use its application and intentionally held back the real, significantly lower figures, until only a week before the $104 billion IPO on May 18th. Read More