• Most Popular
  • Most Shared

Tangoe shares tumble after research group claims fraud

Stocks

   

Thu Sep 6, 2012 10:48pm IST

(Reuters) - Shares of Tangoe Inc (TNGO.O) fell as much as 24 percent after a research group charged the telecommunications software company of misrepresenting facts about its growth rate and called for a probe by the U.S. Securities and Exchange Commission.

"After doing a deep dive into Tangoe's financials, it is our belief that the company has significantly misrepresented its de novo growth rate, while demonstrating many of the telltale shenanigans and behavior that tends to be a harbinger for blow ups," Copperfield Research said.

Copperfield Research is the pseudonym of a research team focusing on equities.

The author of the Tangoe report, who holds a short position in the company's stock, said his report follows a similar one by online blog TheStreetSweeper.

Tangoe could not be immediately reached for comment.

Shares of the Orange, Connecticut-based company were down 12 percent at $14.90 in afternoon trading. The stock, which touched a nine-month low of $12.87 earlier, was the top percentage loser on the Nasdaq on Thursday.

(Reporting by Sruthi Ramakrishnan in Bangalore; Editing by Maju Samuel)
We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (2)
richie1974 wrote:
I’m one of the original core developers of the billingIT system which Tangoe acquired a couple of years ago. This was an open source distributed TEM system. This system was the reason behind the immense profits of billingIT which is why Tangoe acquired us — to make their books look good! Tangoe had no interest in developing technology. They only cared about claiming our profits as their own to make their own numbers look good. These guys are crooks and should be locked up. All of the core tech folks left Tangoe shortly after they acquired us because we knew they didn’t care about developing technology. It was quite obvious. These guys should be in a cell next to Madoff. I should know since I’ve worked for both of this crooks! Tangoe is a fraud. These guys need to be in jail. They destroyed a great company with great software along with the donzens of other companies they destroyed. Not to mention peoples 401k’s who are probably invested into this scam!

Sep 06, 2012 12:21am IST  --  Report as abuse
richie1974 wrote:
Tangoe, Inc is indeed nothing more then a Ponzi scheme as the proof in the numbers have shown that it’s executives have been cooking their books. They have a history of cooking the books as well. I used to be employed by Tangoe after they acquired billingIT which was a startup development arm of ISG (Information Strategies Group). I am one of a small handful of the core development team that developed the billingIT platform based on open-source technologies that was a high volume distributed scalable TEM platform. We were VERY profitable. Tangoe acquired us to claim our profits and clients on their books. They didn’t care about the technology end of it at all. Tangoe is NOT a technology company. They simply care about getting investor money to acquire companies claim that revenue on their books and then use those numbers to acquire more investment money. Their model is not at all profitable. Tangoe has never been profitable except for a short stint after they acquired billingIT and TNGO has not been profitable since then. It doesn’t matter if you can acquire 100% of the market share if your model is not profitable you will not be profitable no matter how much market share you acquire — even if it’s 100% of the market. The Tangoe model is not, never was and never will be profitable. Their model is to buy a bunch of commercial packages and try to glue them together and outsource it. You can not run a high volume scalable platform with this model. You need tech talent to develop technology. Myself and the other core developers left Tangoe shortly after being acquired by them as it was clear they were NOT interested in developing technology and were only interested in manipulating balance sheets. They are a Ponzi scheme just like Madoff was. I should know, I’ve worked for both of these criminals and the Tangoe executives should be in a cell right next to Madoff as far as I’m concerned. There is a call out to the SEC to investigate their fraud.

Sep 07, 2012 10:32pm IST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.
See All Comments »