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The Biggest Business Lies Ever Told
You'll never look at these companies the same way again.
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Honesty and trust are crucial ingredients in business success but not every company chooses to go that route. Some companies lie, mislead their investors and create toxic work environments for their employees — only to have it blow up in their faces.
Business is competitive, but some lines should never be crossed. Let’s look at some of the biggest business lies ever told and the practical lessons you can take away from these notorious mistakes.
Equifax data breach
Equifax is one of the three major credit bureaus in the United States. In 2017, it was involved in a notorious data breach that affected approximately 143 million consumers. Hackers were able to access personal information like credit card numbers, Social Security numbers, home addresses and even driver’s licenses. The breach happened because the company failed to implement basic security measures.
The breach itself was bad enough, but the company intentionally misled customers and withheld information. It also later came out that additional data breaches occurred, but customers weren’t informed. As a result, Equifax had to pay a minimum settlement of $575 million to the Federal Trade Commission (FTC), Consumer Financial Protection Bureau and 50 states and territories. CEO Richard Smith was ousted three weeks after the data breach was revealed.
The takeaway: Don’t compromise on cybersecurity practices, especially if your business houses sensitive customer data. If your company does experience a breach, own up to your part in it and be forthcoming about what went wrong. Lying and trying to cover up the problem will only make it worse.
Theranos fraud
Theranos was a consumer healthcare technology startup founded by Elizabeth Holmes in 2003. Thanks to its supposed breakthrough medical technology, the company was once valued at $10 billion. However, it later emerged that this technology never worked as claimed and Holmes, along with company president Ramesh Balwani, misled investors about its capabilities.
The Securities and Exchange Commission (SEC) charged Holmes and Balwani with massive fraud for deceiving investors about the company’s performance. In January 2022, Holmes was found guilty on four of 11 fraud charges. In November, she was sentenced to more than 11 years in prison. She is currently serving her sentence at a federal prison in Texas and is expected to be released in 2032.
Holmes appealed her conviction in 2024, arguing that the judge made mistakes with evidence in her trial. But in February 2025, the court rejected her appeal and upheld her conviction. She and Balwani were also ordered to pay $452 million to investors.
The takeaway: Don’t make a promise you can’t deliver on. However, if you find yourself coming up short, be truthful about failing to meet expectations. Doubling down on a lie will only make the situation worse.
Boeing 737 Max crashes
The Boeing 737 Max was grounded from March 2019 to December 2020 after two crashes took the lives of 346 people. The accidents were caused by design flaws and the company initially stated that a fix would be ready within a few weeks. Weeks turned into months, however, and as the 737 Max fleet remained grounded, it negatively impacted the aviation industry.
Boeing CEO Dennis Muilenburg had to testify before Congress and later resigned in December 2019. Boeing was charged with fraud for hiding information from safety regulators and eventually agreed to pay $2.5 billion in penalties.
The takeaway: Don’t minimize problems in your business and don’t oversimplify the solutions. The truth will always come out. The government may even compel you to reveal what you’ve tried to keep behind closed doors. Even small businesses can be hauled into court.
Facebook and the Cambridge Analytica scandal
In March 2018, it was revealed that a firm called Global Science Research had harvested data from up to 87 million Facebook users without their consent. This happened because a loophole in Facebook’s privacy policy allowed third-party apps to access vast amounts of big data, including personal information about users’ friends.
The data was later sold to Cambridge Analytica and used to create targeted ads for the 2016 U.S. presidential election. The fallout was significant, with CEO Mark Zuckerberg testifying before Congress. The FTC later fined Facebook $5 billion for privacy violations. Cambridge Analytica ultimately filed for Chapter 7 bankruptcy.
The takeaway: If you collect personal data about your customers, you have an obligation to handle it responsibly. That means protecting it from data breaches and refusing to misuse it internally. An accidental data breach is one thing, but misusing data is a deliberate violation of your customers’ trust.
Wells Fargo fake accounts
From 2002 to 2016, Wells Fargo executives pressured employees to cross-sell products and meet impossibly high sales goals. To reach these quotas, employees resorted to creating millions of unauthorized customer accounts without their knowledge or approval.
For instance, if a customer opened a checking account at the bank, an employee might also secretly open a credit card under that same customer’s name. The fake accounts caused the company’s short-term profits to soar by over $2 billion until the misdeeds were revealed in 2016. Wells Fargo had to pay $3 billion in fines to the SEC and the Department of Justice and the scandal severely damaged the company’s reputation and credibility with its customers.
The takeaway: Don’t create a toxic work culture and set performance standards that are impossible for employees to meet. While this may seem to benefit your business temporarily, it will only hurt it in the long run. A happy and productive work culture can sustain long-term success, while unethical practices will eventually lead to failure.
Vibram health hoax
Vibram USA is the company that makes FiveFinger, a barefoot running shoe. The shoes are thin-soled and flexible, designed to mimic the experience of running barefoot. Vibram claimed the shoes strengthen the muscles in the feet and lower legs; improve range of motion in the ankles, feet and toes; stimulate the neural function required for balance and agility; eliminate heel lift; and allow the foot and body to move more naturally.
But the American Podiatric Medical Association has stated that barefoot running has a negative impact on foot health. In other words, Vibram’s product may have harmed wearers instead of improving their foot health and its medical claims were called into question. In 2014, the company settled a class-action lawsuit for $3.75 million but denied any wrongdoing.
The takeaway: While unique products can make you stand out in a crowded marketplace, never make unsubstantiated claims about your products, even if you believe your claims are true. Additionally, any time you make health claims about a product, ensure your assertions are backed up by peer-reviewed research and expert opinions.
Uber driver deception
Uber has been the source of quite a bit of controversy over the years. One example: The FTC alleged that Uber misled its rideshare drivers about their expected earnings and about financing through its Vehicle Solutions Program.
The government’s suit maintained that Uber exaggerated claims about expected earnings in an effort to recruit new drivers. Uber stated that the median income for drivers in San Francisco was $74,000 and $90,000 in New York, but in reality, less than 10 percent of drivers in those cities earned that much. The actual median incomes were $53,000 in San Francisco and $61,000 in New York.
Uber also claimed that drivers could buy a car through the company’s Vehicle Solutions Program for $20 per day or lease a vehicle for only $17 per day. However, the FTC found that the median weekly purchase and lease payments could exceed $200. In 2017, Uber agreed to pay $20 million to settle the FTC’s charges.
The takeaway: Don’t mislead your employees or contractors about their expected earnings or job benefits. Doing this could put them in a precarious financial situation and lead to increased turnover. When word of your false promises spreads, you may struggle to attract new workers.
The consequences of lying
In each of the above examples, the companies demonstrated a clear lack of transparency. Misguided motives, poor communication and an effort to maintain appearances and avoid accountability caused them to mislead or outright lie to staff and customers.
As these businesses learned firsthand, a lack of transparency harms customers, employees and investors because it prevents them from making informed decisions about how they engage with your organization. Additionally, it can cause irreparable harm to an organization’s reputation.
Consider the following repercussions of business lies:
- Broken trust: As in personal relationships, lying in business can lead to a loss of trust, ultimately pushing customers away. “When a business gets caught in a big lie, the fallout is immediate and cuts deep,” cautioned Adrienne Uthe, founder and strategic advisor for Kronus Communications. “Trust is shattered — both with customers and (potentially) internally.”
- Lost customers: Naturally, if you’re caught in the middle of a massive lie, your customers likely won’t feel comfortable doing business with you anymore. This can lead them directly to your competitors. “Revenue takes a hit as consumers (no longer confident in the brand) walk away, often permanently,” Uthe noted. “Competitors step in to capture the space left behind and talent retention drops as employees no longer believe in the company’s integrity.”
- Financial costs: Untruthful behavior and business lies will affect your bottom line through lost business and potentially massive legal costs. “Beyond lost profits, the legal costs skyrocket with potential lawsuits, compliance fines and PR crisis management,” Uthe warned.
- Tarnished reputation: Protecting your brand’s reputation should be a top priority. One of the worst consequences of lying in business is losing your good reputation. Once your brand gets a bad rep, it’s hard to recover. “The ripple effect isn’t just financial; it’s about reputation and trust (or lack thereof),” Uthe explained. “In today’s world, recovering from a hit like this takes years — if it’s even possible at all.”
Sammi Caramela contributed to this article.