A Facebook whistleblower has claimed that the social network giant misled investors by overstating its growth, according to documents filed with US regulators.
Complaints handed to the Securities and Exchange Commission allege the social network was reassuring investors that user numbers would continue to rise even as its popularity waned. Facebook said it stood by its public statements.
The anonymous reports were prepared by lawyers for Whistleblower Aid, thought to be acting on behalf of Frances Haugen, a former Facebook product manager who has revealed a series of damaging leaks against the technology company.
According to one internal document cited by the complaint, daily use of Facebook by teenagers reduced 13pc between 2019 and 2021, while in the US this was predicted to be even more pronounced at a 45pc decline from 2021 to 2023.
The documents also claim Facebook was not properly counting duplicate accounts when selling its adverts. The complaint alleges: “Facebook overcharged advertisers on a vast scale.”
An internal document says that the reach of its campaigns could be between 5pc and 8pc lower than its projections.
Her other complaints, first reported by CBS’s 60 Minutes, allege Facebook misled investors over the role of its site in the January 6 riots in Washington DC, over how the site is used to spread hate speech, and its impact on teenage mental health.
One letter begins: “Facebook’s stock valuation is based almost entirely on predictions of future advertising revenue. But for years, Facebook has misrepresented core metrics to investors and advertisers.”
Ms Haugen, who left Facebook in May, is due to appear before US senators on Tuesday to discuss her revelations. She is also expected to give evidence to MPs.
Facebook said on Sunday: “Every day our teams have to balance protecting the right of billions of people to express themselves openly with the need to keep our platform a safe and positive place. We continue to make significant improvements to tackle the spread of misinformation and harmful content. To suggest we encourage bad content and do nothing is just not true.”
It added: "We stand by our public statements and are ready to answer any questions regulators may have about our work."
Facebook was contacted for comment over the claim it had misled investors.