Online dating group Cupid jumps after dodging arrow over fake profiles
Monday 01 July 2013
Online dating group Cupid was today cleared of using fake profiles to lure new members but warned it needs to overhaul its operations.
The company behind UniformDating.com and LoveAgain.com said a review by KPMG found there was “no evidence” its staff were misleading registered members into becoming fully paid subscribers.
However, KPMG said Cupid’s staff needed to identify themselves more clearly to customers in the future because their current methods “could potentially lead to confusion”.
Cupid was also told to sharpen up its marketing, governance, technical controls and risk management.
The group said it now planned to create of team of “Dating Advisors”, who will promote “safe dating” across its sites. It will also launch a “safe mode” in which users can limit who they communicate with.
Shares in the company rose by more than 6% on the back of the findings of the probe, which took KPMG two months to complete.
Cupid said: “The scope of the independent review covered the allegations of fake profiles, communication levels, the control environment and content from the Cupid teams at all points in the customer journey, cancellation procedures and database membership analysis.
“The board is pleased to have concluded this review and will continue to innovate and enhance the customer experience, whilst taking steps to ensure its recommendations are implemented and policies and procedures and best practice are complied with.”
Cupid is now more than 11% owned by Martin Hughes’s Toscafund Asset Management. Last month, the company said it had received “a number of approaches” for its casual dating sites such as benaughty.com and flirt.com, and was “exploring the proposed opportunities”.
The group has also admitted that higher spending on customer service and marketing in the first six months of the year are likely to hit short-term profits. It expects underlying earnings for the six months to July of £2.5 million, down from £5.9 million a year earlier.
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