Online dating service Cupid rejects media claims, shares jump

March 25 Mon Mar 25, 2013 5:11am EDT

March 25 (Reuters) - British online dating company Cupid Plc rejected as "misrepresentation and ill-informed speculation" media allegations about its methods to encourage people to buy subscriptions, sending its shares up as much as 79 percent.

The BBC said last month that members of Cupid's online dating services suspected fake "flirtatious" messages had been used to encourage free users to sign up for paid subscriptions.

The company said on Friday it had launched an investigation into "a report" about its methods, but a spokeswoman said then that this was not in response to the allegations in the BBC report.

Ukraine newspaper Kyiv Post published an article on March 15 that said Cupid had hired "motivation managers" to encourage people to buy full subscriptions.

Cupid said on Monday the managers' job was to monitor and interrogate the company's websites to detect technical or product issues and to moderate chat rooms and forums. They do not communicate with free members, it said.

The company, which said it was taking legal advice on the allegations, also denied that it was profiting from telephone numbers used to cancel some subscriptions, saying that it operated toll-free numbers for callers from the United States and Australia and had a low-cost number in the UK.

Cupid's shares were up 59 percent at 78.92 pence at 0904 GMT on the London Stock Exchange.

(Reporting By Richa Naidu in Bangalore; Editing by Maju Samuel and Ted Kerr)

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