Dot.com boss suspended

The board believes page views may have been inflated

The chief executive of UK online entertainment provider e-district.net has been suspended for allegedly fabricating user numbers.

The board of e-district.net has launched a full investigation, after finding reason to believe that the reported numbers of registered users, page impressions and revenues have been substantially overstated.

Steven Laitman, the managing director of e-district.net has been suspended, as has the trading of shares in the company.

Bold words

"This quarter rounds off a year of explosive growth in which our registered user base has more than doubled and our monthly traffic has increased by over 360%," claimed Mr Laitman in his fourth quarter statement in January.

The trading statement provides a precise account of the number of registered and active users, and the total number of page impressions, together with a breakdown of region, gender and access device.

And in December the company boasted of the strong takeup of its UK interactive television services.

Although the board is not aware of any misappropriation of funds, any misleading data would generate more cash for the website.

Industry standard

Figures such as page hits play a vital role in measuring a company's value and are often assessed by potential investors.

And dot.coms which can show that their users spend a long time viewing material on their sites will be able to charge more to advertisers.

Accounting firm PriceWaterhouseCoopers has previously called for an industry standard for measuring web traffic.

A report conducted by the accountants found that almost every internet firm was mis-counting website hits, albeit unawares.

E-district.net has operated the LeisureDistrict Network since 1997 and was floated on the Alternative Investment Market (AIM) in March 1999.

Its shares were suspended at 107.5p on Monday.