Specifically, CPR is investigating whether the Company and its officers and/or directors failed to disclose the following information that: (i) Angie's List was increasingly relying on providing free memberships in order to artificially boost its subscriber figures; (ii) contrary to the Company's claim that it provides its members with unbiased, online reviews, disallowing service providers from buying ratings, the Company consistently derived more than half its revenues from the service providers; (iii) that because Angie's List charged service providers hundreds of dollars for "hot leads", service providers were faced with the choice of charging above market prices for basic, run-of-the-mill services (that could be procured by consumers for cheaper prices) in order to absorb the high referral fees Angie's list was charging -- or simply abandoning Angie's list; (iv) that the legitimacy of the service provider side of Angie's List business model was dubious, as service providers were forced to pay the Company thousands of dollars a year in order to be listed as a highly rated service providers, and if they did not, they would not get customer referrals from Angie's List; and (v) that Angie's List did not vet the service providers listed and recommended on its website, either for qualifications or for safety, leading many consumers to question the value of its recommendations, causing them to be unwilling to pay outsized membership fees. As a result of these omissions, the Company and its officers and directors lacked a reasonable basis for their positive statements about the Company and its business, earnings and financial prospects.Angie's List was co-founded by its namesake, Angie Hicks Bowman, the company's chief marketing officer, and its CEO, William Oesterle. Oesterle has close political ties to former Gov. Mitch Daniels and now Purdue University President, having served as his one-time campaign manager during Daniels' first run for governor in 2004. Oesterle and other key officers are accused of selling off more than $13 million worth of shares in the company during the period of time they allegedly made material misrepresentations about the company's performance. Prominent Indianapolis businessman Michael "Mickey" Maurer, the owner of the company that publishes the Indianapolis Business Journal and Indiana Lawyer, serves on the company's board of directors. Maurer formerly served as head of the Indiana Economic Development Corporation during the Daniels' administration. Angie's List has received more than tens millions dollars' worth of state and local economic development incentives for its base of operations in downtown Indianapolis.
The price of the company's shares closed today at $13.57, down $1.58 a share, or 10.43% on a day when more than 2.5 million of the company's shares were traded, much higher than its average trading day volume of about 1.8 million shares. The stock traded as low as $13.29 per share today after opening today's trading at $15.00 on a previous closing day price of $15.15.
7 comments:
Angie's List did sell out to substandard service providers by removing negative reports in exchange for them making good to the customer who reported the negative behavior.
In one case of fraud I know about, the provider told the Angie's List member that they needed $1200 worth of unneeded work. The provider got a second opinion which stated there was NO NEED for the repair and filed a negative report. After the fraudulent matter was reported, Angie's List removed the negative report after the business refunded the service call fee they charged to try to defraud the customer.
The problem was that other members do not have the benefit of knowing that the provider tries to defraud customers.
It's all about money.
What was it? My recollection is something like 7$ million dollars of taxpayer money to Angie's List, even though they were not IN the downtown TIF and therefore not actually legally qualified for TIF revenues.
Please check the actual dollar amount. Non-the-less, Mayor Ballard wanted our precious tax dollars to go to Angie in substantial amounts. Angie got. IMPD and IFD and other city services did not get.
Good 'investment' Ballard, Vaughn, and Kintner. What is the ROI?
Actually, the amount of incentives exceeded $14 million. From the IBJ:
The Indiana Economic Development Corp. said it offered Angie's List up to $7 million in performance-based tax credits and up to $100,000 in training grants based on the company's job-creation plans.
Indianapolis will invest $7.1 million for infrastructure and neighborhood improvements through a combination of tax-increment-financing contributions, New Market Tax Credits and RebuildIndy funds, the city said.
http://www.ibj.com/angies-list-plans-500-jobs-in-local-expansion/PARAMS/article/28941
Tifs and referendums need to be looked at for the past 8 years. Suspect lots of fraud there.. Turn(er) over every stone on Mainstreet as well.
Anonymous 10:12, until we get Patrick J. Fitzgerald appointed U. S. Attorney, this will continue....our current U. S. Attorney, Joe Hogsett couldn't even bring a charge against Carl Brizzi, even though a conviction with Paul Page....
"Follow the money"
got news for you i am a legitimate company with a good reputation, would never scam a customer, but, after dealing with the lies and the deception of angies list i can tell you from experience with them, they could care less about the consumer, and those of us that run a good company, if there are thieves in the den, well all you have to do is the research and at the end of the page will read the end..........for angies list.
I joined and even though I listed a rural New Jersey address, I wasn't given a list of contractors even close to my area. The one veterinarian I was given was 30 miles away and has a bad verbal history among breeders. I dropped my membership. NO one I know belongs. Is this a money laundering scheme?
Post a Comment