NEW YORK--Twitter Inc misled federal regulators about its defenses against hackers and spam accounts, the social media company's former security chief Peiter Zatko said in a whistleblower complaint.
In an 84-page complaint, Zatko, a famed hacker widely known as "Mudge," alleged Twitter falsely claimed it had a solid security plan, according to documents relayed by congressional investigators. Twitter's shares fell 7.3% to close at $39.865%.
The document alleges Twitter prioritized user growth over reducing spam, with executives eligible to win individual bonuses of as much as $10 million tied to increases in daily users, and nothing explicitly for cutting spam.
Twitter labeled the complaint a "false narrative." The social media company has been battling Elon Musk in court after the world's richest person attempted to pull out of a $44-billion deal to buy Twitter. Musk said it failed to provide details about the prevalence of bot and spam accounts. Tesla Inc Chief Executive Musk had offered to buy Twitter for $54.20 per share, saying he believed it could be a global platform for free speech.
Twitter and Musk have sued each other, with Twitter asking a judge on the Delaware Court of Chancery to order Musk to close the deal. A trial is scheduled for Oct. 17.
Zatko filed the complaint last month with the U.S. Securities and Exchange Commission and the Department of Justice, as well as the Federal Trade Commission (FTC). The complaint was also sent to congressional committees.
"We are reviewing the redacted claims that have been published but what we have seen so far is a false narrative that is riddled with inconsistencies and inaccuracies," Twitter Chief Executive Parag Agrawal told employees in a memo.
