The filing is very comprehensive as obtained by CNN, spanning over 200 pages, and has grave allegations of misleading the Federal Trade Commission, ignoring fake accounts, and indiscriminate access to user data among other things. This could finally be the smoking gun Elon Musk was looking for. Starting with a bit of backstory, in May this year, Elon Musk entered into an agreement to buy Twitter for $44 billion. The deal ultimately fell through, but Twitter decided to take Elon Musk to court. Turns out, as per the purchase agreement Elon Musk was liable to pay the company $1 billion, in case he terminated the deal. We even covered this in a story, here, and also pointed out that it was very difficult to prove the actual number of fake accounts and bots in a platform, which was the basis of Musk’s legal argument against the company. But now new allegations against Twitter have to light, from its own former head of security, the legendary Peiter “Mudge” Zatko. Zatko was fired from the company in January this year, for what the company claims were due to performance related reasons. But Peiter alleges that it was primarily because of his attempt to flag the glaring security lapses to Twitter’s board. Zatko’s complaint to the SEC talks about many issues, but we will specifically look at the part related to the fake or spam accounts count. Elon Musk while backing out of the deal contended that Twitter’s count of monetizable daily active users, or mDAUs is not great way to account for spam or bot activity on the platform, and that it affects his ability to optimally monetize the platform after buying it. Zatko claimed in his disclosures that Twitter’s reporting of bots as a percentage of total mDAUs is deliberately misleading, and that it should be taken as a percentage of total number of accounts on the platform. He also alleges that he started asking about the amount of bot and spam activity on Twitter as early as 2021. But was later informed by Twitter’s head of site integrity, that the company didn’t really know about the exact number on bots on the platform. – CNN This was in part because, Zatko alleges, the company had no real appetite to properly measure the prevalence of bots, and also because the real number would potentially harm the company’s value and image. Zatko’s revelations could have an affect on the upcoming court battle between Elon Musk and Twitter, but it’s hard say anything at this point. As for Musk, he has yet to react on the recent revelations, but his legal team has already taken note, with his lawyer Alex Spiro stating, “We have already issued a subpoena for Mr. Zatko, and we found his exit and that of other key employees curious in light of what we have been finding.” – Our previous story on the saga
