Suffice it to say that today isn’t shaping up to be a good day for Uber (NYSE:UBER). The ride-hailing giant is being accused of a range of morally questionable practices. These include secret political lobbying, duping the police, breaking laws and even exploiting violence against the company’s drivers. Consequently, UBER stock is in the red today.
Perhaps Uber was trying to push for global acceptance of ride-hailing and to avoid regulation. If so, then the company’s plans seem to be backfiring now. Reportedly, over 124,000 confidential documents were leaked to popular U.K. publication The Guardian. Armed with those documents, the publication released an exposé that definitely doesn’t cast Uber in a positive light.
According to the report, co-founder Travis Kalanick tried to force an expansion of Uber into cities around the world over a five-year period. Along the way, Uber secretly tried to garner support from prime ministers, presidents, oligarchs and other powerful individuals.
Furthermore, the report claims Kalanick “dismissed concerns from other executives that sending Uber drivers to a protest in France put them at risk of violence from angry opponents in the taxi industry.”
What’s Happening With UBER Stock?
UBER stock was already in a steady multi-month downtrend, and this development certainly isn’t helping the long-side traders. This morning, the stock was down roughly 3% and broke below $22.
It’s too early to determine how deep and long-lasting the reputational damage will be for Uber. The allegations are numerous, even implicating French President Emmanuel Macron. Supposedly, Macron had brokered a secret deal with Uber’s opponents in the French cabinet.
In response, Uber admitted to “mistakes and missteps.” However, the ride-hailing company seems to want to distance itself from the accusations, saying it wouldn’t “make excuses for past behaviour that is clearly not in line with our present values.”
In due time, the public and Wall Street will decide what — and whom — to believe in this scathing, scandalous report of Uber’s quest to expand its operations globally.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.