E-district.net CEO accused of inflating figures

UK dotcom CEO suspended

By Tim Richardson, 26th February 2001

SaaS data loss: The problem you didn’t know you had

The CEO of entertainment outfit e-district.net has been suspended ahead of an investigation into the dotcom's affairs.

Steven Laitman was told to stand-down on Sunday after an initial inquiry discovered that the numbers of registered users, page impressions and revenues reported to investors appeared to have been "substantially overstated".

Shares in the AIM-listed company were suspended this morning.

In a short statement the company said: "The board of e-district has reason to believe that the reported numbers for registered users, page impressions and revenues have been substantially overstated.

"It is not clear over what period of time this overstatement has occurred but it could include all of 2000.

"The board is not aware of any misappropriation of funds."

Senior managers at the company became aware of "certain irregularities" on Thursday evening.

A spokesman for the company declined to pre-judge the outcome until a full investigation had been completed.

However, he said: "The board is taking this very seriously."

When e-district.net prepared to float a year ago The Register raised its eyebrow's at the claims made by Laitman. Even though e-district was a new name on the block, Laitman reported that the outfit had one million active users in January 2000 and 100 million page impressions a month.

Such high figures would have made e-district one of the biggest sites in the UK behind the likes of the BBC and Yahoo!.

Last month e-district reported it had 3.43 million users and boasted 367 million page impressions a month.

In September it reported that in the six months to June 2000 it made a pre-tax loss of £67,646, compared to a profit of £55,953 in the previous six months. Turnover for the six months to June rolled in a £1.04 million. ®