Dec 4 (Reuters) - Trustpilot's shares plunged more than 30% on Thursday after Grizzly Research disclosed a short position and accused the global review platform of creating fake profiles that gave
Trustpilot Shares Plummet After Accusations by Grizzly Research
Dec 4 (Reuters) - Trustpilot's shares plunged more than 30% on Thursday after Grizzly Research disclosed a short position and accused the global review platform of creating fake profiles that gave negative reviews and then pressuring companies to pay for subscriptions.
The short seller accused the review platform of running a "mafia-style extortion" scheme, claiming businesses with paid Trustpilot subscriptions saw their review scores jump from under 2 out of 5 stars to over 4 stars.
The platform challenged or removed genuine negative reviews of its subscribers, while allowing fake positive reviews to thrive, it added.
Trustpilot rejected the claims, saying the report presented a series of claims that are "selective, misleading and framed to support a predetermined narrative".
"(The report) omits key context and publicly available facts, creating a false impression and exhibits a lack of understanding of how Trustpilot works," the company said in a statement.
Shares of Trustpilot slumped to a near two-year low of 131.2 pence by 1406 GMT.
Founded in 2007 in Denmark, Trustpilot is a global online review platform that helps consumers share feedback and businesses manage their reputation through user-generated ratings and reviews.
(Reporting by Yamini Kalia in Bengaluru; Editing by Leroy Leo)
