Entrepreneur Who Claimed 50% Facebook Stake Arrested for Faking Records

Peter Roesler, President - Web Marketing Pros

By Peter Roesler

President, Web Marketing Pros

Paul Ceglia, an entrepreneur from New York who sued Facebook CEO Mark Zuckerberg for a 50% stake in the social media giant, was arrested this week on charges of falsifying records and destroying evidence.

It appears that the 39-year old was attempting to defraud Facebook and Zuckerberg of billions of dollars. Ceglia was arrested by US Postal inspectors in Wellsville, NY and was scheduled to appear before a federal judge in Buffalo.

Ceglia filed a lawsuit against Zuckerberg in 2010. He claimed that he and Zuckerberg, who were students together at Harvard University, signed an agreement in April 2003 that promised Ceglia 50% of in a new Web venture that eventually became Facebook.

In the lawsuit, Ceglia filed a two-page contract and emails between him and Zuckerberg, which he alleged was proof of the agreement. Police say that after the evidence was examined by forensic experts, Ceglia falsified page one of the contract and attached it to another page that had the signatures of both men. The date on the contract, April 28, 2003, appears to predate the time when Zuckerberg and other founders of Facebook conceived the idea for the Website.

Police also stated that the entrepreneur also faked the emails between the two parties.

Ceglia ran a Website called Streetfax.com in 2003 when he agreed with Zuckerberg to pay him for some programming work. Ceglia stated that Zuckerberg also promised him a 50% stake in what he called at the time, ‘The Face Book.’

Ceglia also stated that he and Zuckerberg traded emails in 2003 and 2004 where they talked about the Facebook project. Police say those emails are falsified.

There was indeed an agreement for programming work between Ceglia and Zuckerberg, but there was nothing in writing about Facebook or any agreement on that project. Legal experts noted several inconsistencies between the two pages that Ceglia included in the lawsuit, such as differences in columns, spacing and margins. The email servers at Harvard had no evidence of the emails Ceglia described.

Ceglia has been charged with a single count of mail fraud and a single count of wire fraud. Both charges carry a maximum sentence of 20 years in prison.


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