This week Facebook admitted the network has tens of millions of 'fake' accounts as a part of its overall user database. The company shared this figure in a filing to the U.S. Securities and Exchange Commission (SEC).
According to BBC News, the social media giant noted it believes there are over 83 million illegitimate accounts, which equates to about 8.7 percent of its overall users.
In its company filing to the SEC Facebook reported having 955 million active accounts as of June 30.
Facebook analyzed its illegitimate accounts as follows:
• 4.8 percent have duplicate profiles
• 2.4 percent "user-misclassified" accounts, which are described by BBC News as personal profiles for pets or businesses
• 1.5 percent Facebook indicated were "undesirable", such as fake names or spam
However, these estimates are based on an internal review of a limited sample of accounts and we apply significant judgment in making this determination, such as identifying names that appear to be fake or other behavior that appears inauthentic to the reviewers. As such, our estimation of duplicate or false accounts may not accurately represent the actual number of such accounts.
This news comes at a time where Facebook is struggling in the stock market. The company is also trying to assure investors the social network is a viable marketing platform. If these figures are accurate and almost 9 percent of users are considered to be useless to advertisers, it would not exactly be a good selling point.
In its Risk Factors section of the report, Facebook notes under the title "Risks Related to Our Business and Industry":
If we fail to retain existing users or add new users, or if our users decrease their level of engagement with Facebook, our revenue, financial results, and business may be significantly harmed.
Despite the 83 million estimated 'fake' accounts, Facebook says its overall numbers are up 29 percent from June 2011, with key growth in markets such as Brazil, Indonesia and India.
In semi-related news, earlier this week a N.Y. startup company claimed approximately only 20 percent of its Facebook ad clicks were legitimate, and the rest were stemming from bots driving up advertising costs. The company has since deleted its Facebook page, and it is yet to be seen what backlash, if any, will result from this situation.
On Aug. 2 NASDAQ closing priced Facebook stock at $20.04, down 4.02 percent, and far lower than its initial offering price.