Facebook agrees to settle Cambridge Analytica privacy suit

Facebook has reached a preliminary agreement in a long-running lawsuit seeking damages from the social network for allowing third parties, including the company Cambridge Analytica, to access users' private data. 

According to a document filed Friday in a San Francisco court, Facebook says it is submitting a draft "agreement in principle" and has requested a stay of proceedings for 60 days to finalize it. 

The social network did not indicate the amount or terms of the agreement in the class action. 

When asked by AFP, Facebook's parent company Meta did not respond on Saturday. 

The deal comes as Meta boss Mark Zuckerberg and former chief operating officer Sheryl Sandberg, who announced her resignation in June, were due to testify in court in September as part of the scandal. 

In a lawsuit initiated in 2018, Facebook users accused the social network of violating privacy rules by sharing their data with third parties including the firm Cambridge Analytica, which was linked to Donald Trump's 2016 presidential campaign. 

Cambridge Analytica, which has since shut down, had collected and exploited, without their consent, the personal data of 87 million Facebook users, to which the platform had given it access. 

This information was allegedly used to develop software steering US voters in favor of Trump. 

In 2019, federal authorities fined Facebook $5 billion for misleading its users and imposed independent oversight of its personal data management. 

Since the Cambridge Analytica scandal broke, Facebook has removed access to its data from thousands of apps suspected of abusing it, restricted the amount of information available to developers in general, and made it easier for users to calibrate restrictions on personal data sharing.

Agence France-Presse

Facebook suspends 'tens of thousands' of apps in privacy review

SAN FRANCISCO, United States—Facebook said Friday it suspended "tens of thousands" of apps on its platform as a result of a privacy practices review launched following a scandal involving Cambridge Analytica.

The review started in 2018 after revelations that the political consultancy hijacked personal data on millions of Facebook users, and it included attorneys, external investigators, data scientists, engineers, policy specialists and others, according to a Facebook statement.

The suspensions are "not necessarily an indication that these apps were posing a threat to people," said vice president of partnerships Ime Archibong, adding that some developers "did not respond to our request for information."

Archibong said the investigation "has addressed millions of apps. Of those, tens of thousands have been suspended for a variety of reasons while we continue to investigate."

The suspected apps were associated with about 400 developers, and many of the software programs were still in testing phases, according to Facebook.

The huge social network became the subject of intense scrutiny after acknowledging in 2018 that Cambridge Analytica misappropriated personal data on tens of millions of Facebook users as part of its work for Donald Trump's presidential campaign.

Subsequently, Facebook said it would review all apps on the platform to determine how they used data and if they respect its privacy rules.

"In a few cases, we have banned apps completely," Archibong said.

Bans can be caused by violations including inappropriately sharing data obtained from Facebook or making data publicly available without protecting people's identities, according to the social network.

APP CRACKDOWN

"One app banned was called myPersonality, which shared information with researchers and companies with only limited protections in place, and then refused our request to participate in an audit," Archibong said.

A year ago, Facebook said it had banned some 400 apps including one called myPersonality, which according to Archibong "shared information with researchers and companies with only limited protections in place," and refused to accept an audit.

Facebook said a recent agreement on privacy with the US Federal Trade Commission, which included a record $5 billion fine, calls for additional oversight on app developers.

It "requires developers to annually certify compliance with our policies," Archibong said. "Any developer that doesn't go along with these requirements will be held accountable."

Facebook earlier this year filed a lawsuit against South Korean data analytics firm Rankwave in California to make sure it isn't breaking the leading social network's rules.

REVAMPING CONTROLS

Along with slapping Facebook with a record fine for data protection violations, the settlement in July called for Facebook to create a privacy committee within its board of directors to be appointed by an independent nominating committee.

This would end "unfettered control" of decisions on privacy by Facebook's chief executive Mark Zuckerberg, the FTC statement said. 

Facebook also will be required to conduct privacy reviews of every new or modified product, service or practice before it is implemented, including for its WhatsApp and Instagram services.

"We have a responsibility to protect people's privacy," Zuckerberg said at the time.

"We're going to set a completely new standard for our industry."

As the news was announced by Facebook, Zuckerberg was in Washington meeting with policymakers on questions about privacy and antitrust issues, and held talks at the White House with President Donald Trump.

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Facebook to pay record $5 billion US fine over privacy violations

WASHINGTON - Facebook Inc will pay a record-breaking $5 billion fine to resolve a government probe into its privacy practices and the social media giant will restructure its approach to privacy, the US Federal Trade Commission said on Wednesday.

The FTC voted 3-2 along party lines to adopt the settlement, which requires court approval, even as Democrats said the settlement did not go far enough or require a large enough fine.

"Despite repeated promises to its billions of users worldwide that they could control how personal information is shared Facebook undermined consumers' choices," said FTC Chairman Joe Simons, a Republican, in a statement.

But Democratic FTC Commissioner Rohit Chopra said the penalty provided "blanket immunity" for Facebook executives "and no real restraints on Facebook's business model" and does "not fix the core problems that led to these violations."

Facebook declined to comment ahead of the settlement's public release.

The FTC said that Facebook's data policy was deceptive to "tens of millions" of people who used Facebook's facial recognition tool and also violated its rules against deceptive practices when it did not disclose phone numbers collected to enable a security feature would be used for advertising.

Under the settlement, Facebook's board will create an independent privacy committee that removes "unfettered control by Facebook CEO Mark Zuckerberg over decisions affecting user privacy."
Facebook also agreed to exercise greater oversight over third-party apps.

Chopra and Democratic FTC Commissioner Rebecca Slaughter, who opposed the settlement, said the $5 billion penalty may be less than Facebook's gains from violating users' privacy.

"Until we address Facebook's core financial incentives for risking our personal privacy and national security, we will not be able to prevent these problems from happening again," Chopra said.

The FTC Republican majority argued the settlement "significantly diminishes Mr. Zuckerberg's power -- something no government agency, anywhere in the world, has thus far accomplished."

The Republican commissioners led by Simons said if the FTC had gone to court "it is highly unlikely that any judge would have imposed a civil penalty even remotely close to this one."

They called the settlement -- in light of what the FTC might have been able to win in a court fight -- "a complete home run."

The Republican majority noted that Zuckerberg and other company executives will have to sign quarterly certifications attesting to the company's privacy practices.

The FTC said Zuckerberg or others filing a false certification could face civil and criminal penalties.

Facebook also is barred from asking for email passwords to other services when consumers sign up.

Facebook is barred from using telephone numbers obtained in a security feature, like two-factor authentication, for advertising and must get user consent if it plans to use data from facial recognition technology.

FTC DECIDED TO SETTLE PROBE

The settlement stems from the company's alleged violations of a 2012 FTC settlement order over privacy issues.

Slaughter said the FTC should have taken Facebook and Zuckerberg to court.

Slaughter also criticized the FTC's decision to grant Facebook and its executives a release from liability for any claims that prior to June 12, 2019 it violated the FTC 2012 settlement as "far too broad" and said the FTC failed "to impose any substantive restrictions on Facebook's collection and use of data from or about users."

Chopra added that by "settling the commission -- and the public -- may never find out what Facebook knows... It is difficult to conclude that the commission got the better end of the bargain."

The FTC has been investigating allegations Facebook inappropriately shared information belonging to 87 million users with the now-defunct British political consulting firm Cambridge Analytica.

The FTC also said Wednesday that Cambridge's former CEO Alexander Nix and former app developer Aleksandr Kogan, who worked with the company, had agreed to a settlement with the FTC that will restrict how they conduct business in the future.

The settlement comes a day after the US Justice Department said on Tuesday it was opening a broad investigation of major digital technology firms into whether they engage in anti-competitive practices, the strongest sign the Trump administration is stepping up its scrutiny of Big Tech.

The review will look into "whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers," the Justice Department said in a statement.

The Justice Department did not identify specific companies but said the review would consider concerns raised about "search, social media, and some retail services online" -- an apparent reference to Alphabet Inc, Amazon.com Inc and Facebook Inc, and potentially Apple Inc . 

(Reporting by David Shepardson; Editing by Lisa Shumaker)

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Facebook to create privacy panel, pay $5 billion to US to settle allegations

WASHINGTON - The Federal Trade Commission is set to announce on Wednesday that Facebook Inc has agreed to a sweeping settlement of significant allegations it mishandled user privacy and pay $5 billion, two people briefed on the matter said.

As part of the settlement, Facebook will agree to create a board committee on privacy and will agree to new executive certifications that users' privacy is being properly protected, the people said.

The Washington Post reported on Tuesday that the FTC will alleged Facebook misled users about its handling of their phone numbers and its use of two-factor authentication as part of a wide-ranging complaint that accompanies a settlement ending the government's privacy probe, citing two people familiar with the matter.

The Post also reported the FTC also plans to allege Facebook provided insufficient information to about 30 million users about a facial recognition tool, an issue identified earlier by Consumer Reports.

Two people briefed on the matter confirmed the Post report the FTC will not require Facebook to admit guilt as part of the settlement. The settlement will need to be approved by a federal judge and will contain other significant allegations of privacy lapses, the people said.

The fine will mark the largest civil penalty ever paid to the FTC.

The FTC and Facebook declined to comment.

The FTC confirmed in March 2018 it had opened an investigation into allegations Facebook inappropriately shared information belonging to 87 million users with the now-defunct British political consulting firm Cambridge Analytica. The probe has focused on whether the data sharing violated a 2011 consent agreement between Facebook and the regulator and then widened to include other privacy allegations.

A person briefed on the matter said the phone number, facial recognition and two-factor authentication issues were not part of the initial Cambridge Analytica probe.

Some in Congress have criticized the reported $5 billion penalty, noting Facebook in 2018 had $55.8 billion in revenue and $22.1 billion in net income. Senator Marsha Blackburn, a Republican, said last week the fine should be $50 billion.

While the deal resolves a major regulatory headache for Facebook, the Silicon Valley firm still faces further potential antitrust probes as the FTC and Justice Department undertake a wide-ranging review of competition among the biggest U.S. tech companies. Facebook is also facing public criticism from President Donald Trump and others about its planned cryptocurrency Libra over concerns about privacy and money laundering.

The Cambridge Analytica missteps, as well as anger over hate speech and misinformation on its platform, have prompted calls from people ranging from presidential candidate Senator Elizabeth Warren to a Facebook co-founder, Chris Hughes, for the government to force the social media giant to sell Instagram, which it bought in 2012, and WhatsApp, purchased in 2014.

But the company's core business has proven resilient, as Facebook blew past earnings estimates in the past two quarters. Facebook is set to report earnings on Wednesday.

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$5-billion US fine set for Facebook on privacy probe: report

WASHINGTON, United States - US regulators have approved a $5-billion penalty to be levied on Facebook to settle a probe into the social network's privacy and data protection lapses, the Wall Street Journal reported Friday.

The newspaper said the Federal Trade Commission approved the settlement in a 3-2 vote, with the two Democratic members of the consumer protection agency dissenting.

According to the report, the deal, which would be the largest penalty imposed over privacy violations, still needs approval from the justice department before it is finalized.

Facebook did not immediately respond to an AFP query on the agreement.

The settlement would be in line with Facebook's estimate earlier this year when it said it expected to pay $3 billion to $5 billion for legal settlements on "user data practices."

The FTC announced last year it reopened its investigation into a 2011 privacy settlement with Facebook after revelations that personal data on tens of millions of users was hijacked by the political consultancy Cambridge Analytica, working on the Donald Trump campaign in 2016.

Facebook has also faced questions about whether it improperly shared user data with business partners in violation of the earlier settlement.

The leading social network with more than 2 billion users worldwide has also been facing inquiries on privacy from authorities in US states and regulators around the world.

Some Facebook critics have argued the company should face tougher sanctions including monitoring of its data practices, or that chief executive Mark Zuckerberg should be personally liable for penalties.

Charlotte Slaiman of the consumer group Public Knowledge said it was not immediately clear if the settlement would require changes to Facebook's business practices, but suggested that the partisan split on the vote was a bad omen.

"I'm hopeful that additional conditions placed on Facebook's business practices will be forthcoming," Slaiman said in a statement.

"Those conditions should protect not just user privacy, but also the users' opportunity to easily leave Facebook for a competitor if they choose."

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Facebook shares drop as data privacy fallout spreads

WASHINGTON - Facebook Inc shares sank on Wednesday as concerns about its ability to safeguard user data sparked a government lawsuit, criticism in the US Congress and a New York Times report on how it had shared data with other companies.

The stock of the world's largest social media company fell 7.25 percent, its biggest intraday drop since July, taking losses for the year to about 24 percent. Investors are concerned about snowballing legal and regulatory efforts over data use polices that have upset many customers and could carry significant penalties and costs.

In particular, the Silicon Valley firm has drawn global scrutiny since disclosing earlier this year that a third-party personality quiz distributed on Facebook gathered profile information on 87 million users worldwide and sold the data to British political consulting firm Cambridge Analytica.

Washington, D.C., Attorney General Karl Racine said the US capital city was suing Facebook, accusing it of misleading users because it had known about the incident for 2 years before disclosing it.

It further alleges Facebook misled users by allowing several app makers it called partners "to override Facebook consumers' privacy settings and access their information without their knowledge or consent."

Facebook said in a statement, "We're reviewing the complaint and look forward to continuing our discussions with attorneys general in D.C. and elsewhere."

The New York Times reported new details on Tuesday about the user data that remained available to such partners years after they had shut down features that required them. Facebook acknowledged the lapse in a blog post but said it had not found evidence of wrongdoing by those partners.

In response, both Democrat and Republican lawmakers criticized the company and queried whether Chief Executive Officer Mark Zuckerberg had lied to Congress in hearings earlier this year.

The incoming chair of the House Judiciary Committee's antitrust subcommittee, Representative David Cicilline, tweeted: "Zuckerberg told Congress that Facebook users had 'complete control' over their data. Sure looks like he lied."

Incoming Republican senator Josh Hawley made similar comments about Zuckerberg's testimony.

The stock slide was the worst since the owner of Facebook, WhatsApp and Instagram warned in July that profit margins would erode in coming years because of consumer and government pressure to better guard data and suppress objectionable content.

"Facebook could have prevented third parties from misusing its consumers' data had it implemented and maintained reasonable oversight of third-party applications," according to the lawsuit filed in the Superior Court of Washington, D.C., on Wednesday.

The court could award unspecified damages and impose a civil penalty of up to $5,000 per violation of the district's consumer protection law, or potentially close to $1.7 billion, if penalized for each consumer affected. The lawsuit alleges the quiz software had data on 340,000 D.C. residents, though just 852 users had directly engaged with it.

'CONFUSING SETTINGS'

Facebook offered separate privacy settings around 2013 to control what friends on the network could see and what data could be accessed by apps, enabling the quiz and other services to collect details about users' Facebook friends without many of them realizing it, according to the lawsuit.

Racine told reporters that Facebook had tried to settle the case before he filed suit, as is common during investigations of large companies, but that a lawsuit was necessary "to expedite change" at the Silicon Valley company.

Britain's data protection authority in July fined Facebook 500,000 pounds ($631,000) for breaches of data in the Cambridge Analytica incident.

Since then, Facebook has disclosed a pair of security breaches involving profile data and posts of up to 29 million users and 6.8 million users, respectively.

At least 6 US states have ongoing investigations into Facebook, according to state officials.

In March, a bipartisan coalition of 37 state attorneys wrote to the company, demanding to know more about the Cambridge Analytica data and its possible links to US President Donald Trump's election campaign.

At the same time, the Federal Trade Commission took the unusual step of announcing an investigation into whether Facebook had violated a 2011 consent decree, exposing the company to a multi-billion dollar fine.

State attorneys general have found some success taking on technology companies over data privacy. Uber Technologies Inc in September agreed to pay $148 million as part of a data breach settlement with 50 US states and Washington, D.C..

Agnieszka McPeak, a professor at Duquesne University School of Law, said states will likely make claims similar to those of D.C., pressuring Facebook into a settlement that involves both a monetary fine and modified business practices. "If a company faces 51 separate actions around the country for deceptive practices, that can have a real impact," McPeak said. 

source: news.abs-cbn.com

Lawsuit adds to Facebook woes on data protection

WASHINGTON, United States -- Facebook's woes mounted Wednesday as it faced a lawsuit alleging privacy violations related to data leaked to a consultancy working on Donald Trump's 2016 campaign, and as a new report suggested it shared more data with partners than it has acknowledged.

Facebook shares already sagging under the weight of the social network's troubles ended the trading day down 7.25 percent to $133.24 and slipped even lower in after-market trades.

The suit filed by the attorney general for the US capital Washington is likely the first by an official US body that could impose consequences on the world's leading social network for data misuse.

"Facebook failed to protect the privacy of its users and deceived them about who had access to their data and how it was used," said Attorney General Karl Racine in a statement.

"Facebook put users at risk of manipulation by allowing companies like Cambridge Analytica and other third-party applications to collect personal data without users' permission. Today's lawsuit is about making Facebook live up to its promise to protect its users' privacy."

The suit filed in Superior Court in Washington seeks an injunction "to ensure Facebook puts in place protocols and safeguards to monitor users' data and to make it easier for users to control their privacy settings," and demands "restitution" for consumers.

Facebook said: "We're reviewing the complaint and look forward to continuing our discussions with attorneys general in DC and elsewhere."

The social network has admitted that up to 87 million users may have had their data hijacked by Cambridge Analytica, which shut down weeks after the news emerged on its handling of private user information.

A whistleblower at the consultancy, which worked on Trump's presidential campaign, said it used Facebook data to develop profiles of users who were targeted with personalized messages that could have played on their fears.

The scandal has triggered a series of investigations and broad review by Facebook on how it shares user data with third parties.

Sharing with 150 partners

The New York Times reported that some 150 companies -- including powerful partners like Amazon, Microsoft, Netflix and Spotify -- could access detailed information about Facebook users, including data about their friends.

According to documents seen by the Times, Facebook allowed Microsoft's Bing search engine to see names of Facebook users' friends without consent and gave Netflix and Spotify the ability to read private messages.

The report said Amazon was able to obtain user names and contact information through their friends, and Yahoo could view streams of friends' posts.

While some of the deals date back as far as 2010, the Times said they remained active as late as 2017 -- and some were still in effect this year.

"It appears that Facebook has not been honest with Congress or the public about how it treats its users' data," Congressman Frank Pallone, a Democrat, said in a tweet.

Facebook's head of developer platforms and programs, Konstantinos Papamiltiadis, said in a blog post that the Times report referred to partnerships that enabled "social experiences -- like seeing recommendations from their Facebook friends -- on other popular apps and websites."

None of those partnerships or features "gave companies access to information without people's permission," he said, adding that the deals did not violate a 2012 privacy settlement with the US Federal Trade Commission.

Papamiltiadis said, however, that "we've been public about these features and partnerships over the years because we wanted people to actually use them."

But he said most of the features are now gone.

Netflix, Spotify deny reading messages 

Netflix said that the feature was used to make the streaming service "more social" by allowing users to make recommendations to friends, but that it stopped using it in 2015.

"At no time did we access people's private messages on Facebook or ask for the ability to do so," Netflix said in a statement.

Spotify offered a similar response, indicating the music service "cannot read users' private Facebook inbox messages across any of our current integrations."

The Canadian bank RBC, also cited in The New York Times, said the deal with Facebook "was limited to the development of a service that enabled clients to facilitate payment transactions to their Facebook friends," and that it was discontinued in 2015.

Senator Brian Schatz said the latest revelations highlight a need for tougher controls on how tech companies handle user data.

"It has never been more clear," Schatz tweeted. "We need a federal privacy law. They are never going to volunteer to do the right thing."

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Facebook teaches New Yorkers about privacy at 'pop-up' kiosk

NEW YORK, United State -- Facebook, under fire over missteps on privacy and data protection, went directly to the public on Thursday with a pop-up kiosk in New York where users could ask questions and find out more about how the social network handles personal information.

The public relations exercise, a one-day event at the midtown holiday market in Bryant Park, was a first for Facebook in the United States and followed a similar presentation in September in London.

Facebook employees handed out coffee and hot chocolate along with advice for users on understanding and adjusting their privacy settings, and explained how users can choose to share or exclude people from seeing their images and posts.

The world's biggest social network -- whose image has been hit by revelations about manipulation by foreign actors, leaking of personal information and other issues -- sought to explain how Facebook collects data and delivers personally targeted advertising.

"We know people have questions about privacy and ads on the platform so we said this would be a great time to meet with people face-to-face and have an interaction session and answer their questions," said Khaliah Barnes, privacy and public policy manager at Facebook's Washington office.

"I am hoping we can connect with a lot of people."

Facebook has been the target of boycotts and investigations around the world over the past few months, notably since the revelations on the hijacking of personal data by Cambridge Analytica, a consultancy working on Donald Trump's presidential campaign in 2016.

Jennifer Shin, 26, who works in advertising in New York, said the experiment was "interesting" because of the negative image of Facebook at the moment.

It may be useful, she said, "just to educate the public about what you can do with your (privacy) settings."

Michael Beswetherick, a 26-year-old New York Times software engineer who stopped by the kiosk, admitted he had a "negative bias for sure" about Facebook but said the employees on site "were all really nice."

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Britain hits Facebook with maximum fine over data scandal

LONDON - Britain's data watchdog on Thursday levied the maximum possible fine of 500,000 pounds ($644,000) against Facebook Inc. for failing to protect the privacy of its users in the Cambridge Analytica scandal.

The Information Commissioner's Office said its probe found that from 2007 to 2014, Facebook processed the personal information of users unfairly by giving application developers access to their information without informed consent.

"Facebook failed to sufficiently protect the privacy of its users before, during and after the unlawful processing of this data," said Elizabeth Denham, the information commissioner. "A company of its size and expertise should have known better and it should have done better."

Facebook is struggling with security issues following its April admission that data on up to 87 million users may have been improperly shared with the political consulting firm Cambridge Analytica, which worked for the 2016 U.S. presidential election campaign of Donald Trump.

==Kyodo

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Facebook to drop on-site support for political campaigns

SAN FRANCISCO - Facebook Inc said on Thursday that it would no longer dispatch employees to the offices of political campaigns to offer support ahead of elections, as it did with US President Donald Trump in the 2016 race.

The company and other major online ad sellers including Alphabet Inc's Google and Twitter Inc have long offered free dedicated assistance to strengthen relationships with top advertisers such as presidential campaigns.

Brad Parscale, who was Trump's online ads chief in 2016, last year called onsite "embeds" from Facebook crucial to the candidate's victory. Facebook has said that Democratic challenger Hillary Clinton was offered identical help, but she accepted a different level than Trump.

Google and Twitter did not immediately respond to requests to comment on whether they also would pull back support.

Facebook said it could offer assistance to more candidates globally by focusing on offering support through an online portal instead of in person. It said that political organizations still would be able to contact employees to receive basic training on using Facebook or for assistance on getting ads approved.

Bloomberg first reported the new approach.

Facebook, Twitter, and Google served as "quasi-digital consultants" to US election campaigns in 2016, researchers from the University of North Carolina at Chapel Hill and University of Utah found in a paper published a year ago.

The companies helped campaigns navigate their services' ad systems and "actively" shaped campaign communication by suggesting what types of messages to direct to whom, the researchers stated.

Facebook's involvement with Trump's campaign drew scrutiny from US lawmakers after the company found its user data had separately been misused by political data firm Cambridge Analytica, which consulted for the Trump campaign.

In written testimony to US lawmakers in June, Facebook said its employees had not spotted any misuse "in the course of their interactions with Cambridge Analytica" during the election. 

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Tech firms should be made liable for 'fake news' on sites -UK lawmakers

LONDON - Tech firms like Facebook should be made liable for "harmful and misleading" material on their websites and pay a levy so they can be regulated, British lawmakers said, warning of a crisis in democracy due to misuse of personal data.

Facebook has increasingly become a focus of the media committee's inquiry into "fake news" after the data of 87 million users was improperly accessed by British-headquartered consultancy Cambridge Analytica.

Facebook executives said on Wednesday its profit margins would plummet for several years due to the cost of improving privacy safeguards and slowing usage in its top advertising markets. The news wiped over $120 billion off the company's share price.

At the same time, the company is coming under concerted regulatory scrutiny in Britain, the United States and the European Union.

"Companies like Facebook made it easy for developers to scrape user data and to deploy it in other campaigns without their knowledge or consent," Damian Collins, chair of the Digital, Culture, Media and Sport Committee, said in a statement officially released on Sunday.

"They must be made responsible, and liable, for the way in which harmful and misleading content is shared on their sites."

The report was first published online late on Friday by Dominic Cummings, who ran the officially designated Vote Leave campaign in the EU referendum.

The standards of accuracy and impartiality which tech companies are held to could be based on regulator Ofcom's rules for television and radio, the lawmakers said.

British broadcasters, whether publicly or privately owned, must generally stick to strict rules on political balance and factual accuracy, overseen by a regulator.

TechUK, a trade association for technology firms operating in Britain said it would be challenging to hold them to a higher standard than the country's newspapers or politicians.

"Sometimes decisions about what is and isn't 'fake' will be highly political and contentious," techUK's deputy director, Antony Walker, said.

"Determining what is and is not accurate information is not always straightforward and both traditional media and elected politicians can often be sources of news that is inaccurate or untrue," he added.

The committee's report also suggested a levy on tech firms which could contribute to an increased budget for Britain's data regulator, the Information Commissioner's Office (ICO), in the way in which the banking sector pays for the upkeep of its watchdog, the Financial Conduct Authority.

The ICO earlier this month fined Facebook for the Cambridge Analytica scandal.

Tom Watson, deputy leader of Britain's opposition Labour Party, said the government had previously rejected its efforts to give the ICO greater investigation powers and improve disclosure of how online political adverts are funded.

Cambridge Analytica, which was hired by Donald Trump's campaign in 2016, has denied its work on the US president's election made use of the data in question.

It has also said that while it pitched for work with campaign group Leave.EU before the Brexit referendum in Britain in 2016, it did not end up doing any work on the campaign.

The committee however said that adverts used online in the campaign were not clearly labelled, and expressed concern about a breach of spending rules by rival campaign group Vote Leave.

"We are facing nothing less than a crisis in our democracy – based on the systematic manipulation of data to support the relentless targeting of citizens ... by campaigns of disinformation and messages of hate," Collins said.

The findings were made in an interim report, with the full report due in the autumn.

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Facebook hammered as user growth cools

SAN FRANCISCO, United States - Facebook shares took a hit Wednesday after the world's biggest social network reported weaker-than-expected user growth in the first full quarter since being rocked by a series of scandals on data privacy.

The company said profit was up 31 percent in the second quarter at $5.1 billion as revenues rose 42 percent to $13.2 billion.

But shares slumped 7 percent in after-hours exchanges after hitting record levels in official trading, with the quarterly report largely weaker than had been expected.

"Our community and business continue to grow quickly. We are committed to investing to keep people safe and secure, and to keep building meaningful new ways to help people connect," chief executive Mark Zuckerberg said.

Zuckerberg has said he did not expect a meaningful impact from the uproar over data hijacked by political consulting firm Cambridge Analytica, but the last quarter's figures suggested some cooling.

The key metric of monthly active users rose 11 percent to 2.23 billion, below most estimates of 2.25 billion, while daily active users grew a weaker-than-expected 11 percent to 1.47 billion.

Almost all of Facebook's revenue -- $13 billion of the total $13.2 billion -- came from online advertising, a sector dominated by the California social network along with Silicon Valley rival Google.

Although Facebook shares were in a slump after the Cambridge Analytica scandal broke earlier this year, the stock had risen sharply and hit record levels this month.

According to the research firm eMarketer, Facebook is expected to hold an 18 percent share of the $273.29 billion worldwide digital ad market, behind Google's 31 percent.

According to the research firm, Facebook-owned Instagram is making up for some of the slowdown in growth at social network and will generate $8.06 billion in worldwide ad revenue this year.

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Facebook 'not aware of any abuse' of data by phone makers

WASHINGTON - Facebook said Monday it did not know of any privacy abuse by cellphone makers who years ago were able to gain access to personal data on users and their friends.

The social media leader said it "disagreed" with the conclusions of a New York Times report that found that the device makers could access information on Facebook users' friends without their explicit consent.

Facebook enabled device makers to interface with it at a time when it was building its service and they were developing new smartphone and social media technology.

But the Times said the access continued even after Facebook agreed with the Federal Trade Commission in 2011 to better protect data and only share it after obtaining consumers' express consent.

Facebook, which came under attack early this year over British political consultant Cambridge Analytica's harvesting of personal data on 87 million Facebook users and their friends, did not deny the Times story but said it "disagreed" with the issues raised.

Before now-ubiquitous apps standardized the social media experience on smartphones, some 60 device makers like Amazon, Apple, Blackberry, HTC, Microsoft and Samsung worked with Facebook to adapt interfaces for the Facebook website to their own phones, the company said.

"We controlled them tightly from the get-go," said Ime Archibong, VP of Product Partnerships, in a statement.

"Partners could not integrate the user's Facebook features with their devices without the user's permission," he said.

"Friends' information, like photos, was only accessible on devices when people made a decision to share their information with those friends," he said.

Moreover, he added, "We are not aware of any abuse by these companies."

But the Times said that the user permissions were not always explicit as required by the 2011 consent decree with the FTC.

In addition, it said, its research showed that some device makers "could retrieve personal information even from users' friends who believed they had barred any sharing."

Facebook said it was winding up the interface arrangements with device makers as the company's smartphone apps dominate the service.

But the report raised concerns that massive databases on users and their friends -- including personal data and photographs -- could be in the hands of device makers as was the case with Cambridge Analytica.

Cambridge Analytica obtained the data without Facebook's permission and used it to help the election campaign of US President Donald Trump.

In April, Facebook chief executive Mark Zuckerberg apologized in Congress over the Cambridge Analytica fiasco, amid rising calls for more regulation of the company.

On Monday, some US lawmakers suggested calling him back to testify.

"Sure looks like Zuckerberg lied to Congress about whether users have 'complete control' over who sees our data on Facebook," said David Cicilline, a Democrat who serves on the House Judiciary committee.

"Facebook's secret data sharing partnerships raise urgent new reasons for stronger privacy protections," said Democratic Senator Richard Blumenthal.

source: news.abs-cbn.com

U.S. investigating Cambridge Analytica: New York Times

WASHINGTON - The U.S. Justice Department and the FBI are investigating Cambridge Analytica, a now-defunct political data firm embroiled in a scandal over its handling of Facebook Inc user information, the New York Times reported on Tuesday.

Prosecutors have sought to question former Cambridge Analytica employees and banks that handled its business, the newspaper said, citing an American official and others familiar with the inquiry,

Cambridge Analytica said earlier this month it was shutting down after losing clients and facing mounting legal fees resulting from reports the company harvested personal data about millions of Facebook users beginning in 2014.

Allegations of the improper use of data for 87 million Facebook users by Cambridge Analytica, which was hired by President Donald Trump's 2016 U.S. election campaign, have prompted multiple investigations in the United States and Europe.

The investigation by the Justice Department and FBI appears to focus on the company's financial dealings and how it acquired and used personal data pulled from Facebook and other sources, the Times said.

Investigators have contacted Facebook, according to the newspaper.

The FBI, the Justice Department and Facebook declined to comment to Reuters. Former officials with Cambridge Analytica was not immediately available to comment.

Cambridge Analytica was created around 2013, initially with a focus on U.S. elections, with $15 million in backing from billionaire Republican donor Robert Mercer and a name chosen by future Trump White House adviser Steve Bannon, the New York Times has reported. Bannon left the White House on August 2017.

(Reporting by Eric Beech; Editing by Peter Cooney)

source: news.abs-cbn.com

Cambridge Analytica to close after Facebook data scandal

LONDON - Cambridge Analytica, the British marketing analytics firm, announced Wednesday that it was closing and would file for insolvency in Britain and the United States after failing to recover from the Facebook data scandal.

The decision follows weeks of intense pressure on the company, hired by Donald Trump's presidential campaign, after allegations emerged it may have hijacked up to 87 million Facebook users' data.

It claimed it has been "vilified" by the "numerous unfounded accusations" which torpedoed its business and left the firm with "no realistic alternative" but to go into administration.

"Despite Cambridge Analytica's unwavering confidence that its employees have acted ethically and lawfully... the siege of media coverage has driven away virtually all of the company's customers and suppliers," it said in a statement.

"As a result, it has been determined that it is no longer viable to continue operating the business."

An affiliate of British firm Strategic Communication Laboratories (SCL), CA has offices in London, New York, Washington, as well as Brazil and Malaysia.

It drew attention after former Trump chief strategist Steve Bannon reportedly once sat on its board and was bankrolled to the tune of $15 million by US billionaire and Republican donor Robert Mercer. 

It first became embroiled in scandal in March when Canadian whistleblower Christopher Wylie, a 28-year-old former analyst for the firm, revealed it had created psychological profiles of tens of millions of Facebook users via a personality prediction app.

The revelations instantly reverberated around the world, wiping billions from the social media giant's market value and drawing scrutiny from politicians and regulators on both sides of the Atlantic.

To make matters worse for CA, CEO Alexander Nix was suspended within days after he was filmed by undercover reporters bragging about ways to win political campaigns, including through blackmail and honey traps.

As the crisis intensified, Facebook chief Mark Zuckerberg was forced to apologize to its billions of users amid a small but growing exodus from the site.

He eventually appeared before Congress for a 2-day grilling by lawmakers, and has since vowed to overhaul the way the Facebook shares its users' data.

In Britain, regulators ratcheted up a probe into CA, raiding its London offices, and later extending the investigation to 30 organizations, including Facebook.

A second whistleblower from the firm also emerged at a parliamentary hearing in April claiming Britons' personal data may have been misused by a pro-Brexit campaign ahead of the 2016 referendum in which Britain voted to leave the European Union.

Earlier this month, Facebook upped its count of the number of people impacted, admitting that up to 87 million users may have had their data harvested.

CA has vehemently denied exploiting that data for Trump's election campaign, claiming it deleted data obtained in breach of the social network's terms of service.

At a London press conference last week a CA spokesman claimed the company was "no Bond villain" and had broken no laws.

It hired British barrister Julian Malins to conduct an independent investigation into what it termed "a torrent of ill-informed and inaccurate speculation" and posted his report on its website Wednesday. 

"(The) report... concluded that the allegations were not 'borne out by the facts'," CA said.

"(It) has been vilified for activities that are not only legal, but also widely accepted as a standard component of online advertising in both the political and commercial arenas," it added. 

But the company conceded the crisis had taken too heavy a toll and said its board had appointed lawyers in Britain to oversee the insolvency process, and would be following suit in America.

CA said that although its financial condition was "precarious" it intended "to fully meet its obligations to its employees"

Initial reaction to the news in Britain was guarded. 

Damian Collins MP, chair of a parliamentary committee that held the hearings on the issue and questioned Nix in February and Facebook executives last month, warned CA "cannot be allowed to delete their data history by closing". 

"The investigations into their work are vital," he added.

source: news.abs-cbn.com

Facebook beats Wall Street's revenue estimates, shares rise

Facebook Inc shares rose after the bell on Wednesday after the social network reported revenue that beat Wall Street estimates, showing no initial impact on its lucrative ad business from a scandal over the handling of personal data.

Shares traded up 4.6 percent at $167, paring a month-long decline that began with Facebook's disclosure in March that consultancy Cambridge Analytica had harvested data belonging to millions of users.

Facebook's quarterly profit also beat analysts' estimates, as a 49 percent jump in quarterly revenue slightly outpaced a 39 percent rise in expenses from a year earlier. The mobile ad business grew on a major push to add more video content.

Facebook said monthly active users in the first quarter rose to 2.2 billion, up 13 percent from a year earlier and matching expectations, according to Thomson Reuters I/B/E/S.

The results are a bright spot for the world's largest social network amid months of negative headlines about the company's handling of personal information, its role in elections and its fueling of violence in developing countries.

Facebook, which generates revenue primarily by selling advertising personalized to its users, has demonstrated for several quarters how resilient its business model can be as long as users keep coming back to scroll through its News Feed and watch its videos.

Chief Executive Mark Zuckerberg said in a statement that Facebook was "investing to make sure our services are used for good."

Net income attributable to Facebook shareholders rose in the first quarter to $4.99 billion, or $1.69 per share, from $3.06 billion, or $1.04 per share, a year earlier.

Analysts on average were expecting a profit of $1.35 per share, according to Thomson Reuters I/B/E/S.

Total revenue was $11.97 billion, above the analyst estimate of $11.41 billion.

Tighter regulation could make Facebook's ads less lucrative by reducing the kinds of data it can use to personalize and target ads to users, although Facebook's size means it could also be well positioned to cope with regulations.

Facebook and Alphabet Inc's Google together dominate the internet ad business worldwide. Facebook is expected to take 18 percent of global digital ad revenue this year, compared with Google's 31 percent, according to research firm eMarketer.

Facebook said it ended the first quarter with 27,742 employees, an increase of 48 percent from a year earlier.

The company said it was increasing the amount of money authorized to repurchase shares by an additional $9 billion. It had initially authorized repurchases up to $6 billion.

Facebook shares closed at $185.09 on March 16, the day that the Cambridge Analytica scandal broke after the bell on a Friday. In the days immediately afterward, the company lost more than $50 billion in market value.

Even if the company's flagship social network, Facebook, suffers large reputational damage among users or advertisers, it still owns three more of the most popular smartphone apps in the world: Instagram, Messenger and WhatsApp.

source: news.abs-cbn.com

#ZuckerBowl without a clear winner as Facebook hearings end

WASHINGTON - Facebook founder Mark Zuckerberg emerged largely unscathed Wednesday from 2 days of high-stakes hearings that saw US lawmakers grill the billionaire over how the online giant feeds users' data to advertisers and chide him over privacy rights.

The marathon 10 hours of questioning was one of the biggest spectacles in Congress in recent memory, followed blow by blow on social media under the hashtags #ZuckerBowl and #ZuckUnderOath.

Channeling public anger over data privacy lapses -- including most spectacularly the leak of personal information from 87 million Facebook users to a political consultant -- lawmakers in both House and Senate raised the specter of regulations to bring online firms to heel.

The 33-year-old CEO conceded that some regulation of social media companies is "inevitable," while offering a laundry list of reform pledges at Facebook and vowing to improve privacy and security.

But he stiffly defended Facebook's business model -- specifically the way it uses data and postings from the 2.2 billion users of its free platform -- calling it necessary to attract ad revenue the $480 billion company depends on.

In the wake of the massive leak of user information to Cambridge Analytica, which worked for Donald Trump's 2016 campaign, Zuckerberg reiterated that the company had shut down the pipeline that allowed data -- including his own -- to slip without consent into the hands of third parties.

A day earlier Zuckerberg took personal responsibility for the data breach.

Yet in his testimony to the House Energy and Commerce Committee, he was also steadfast in arguing that Facebook's users themselves are choosing to make their data available, and that the company's "opt-in" provisions offered them sufficient control.

"Every time that a person chooses to share something on Facebook, they're proactively going to the service and choosing that they want to share a photo, write a message to someone."

"Every time there is a control right there," Zuckerberg said.

'REAL TRUST GAP' 

Zuckerberg faced tougher questions from House lawmakers over Facebook's stance than during Tuesday's 5-hour session in the Senate, where his defense of data sharing was weakly challenged.

"It strikes me that there's a real trust gap here. Why should we trust you?" asked Democratic Representative Mike Doyle.

"The only way we're going to close this trust gap is through legislation that creates and empowers a sufficiently resourced expert oversight agency, with rule-making authority to protect the digital privacy and ensure that companies protect our users' data."

A PATH FORWARD 

Some analysts said Zuckerberg's appearance suggests a new path forward for social media under closer scrutiny.

"Zuckerberg's testimony demonstrated that the company has matured over the last decade, in particular in his acknowledgement that Facebook is responsible for the content shared on its platform," said University of Delaware communications professor Dannagal Young. 

"Acknowledging responsibility for the content shared on the platform changes how Facebook ought to engage in gate-keeping and fact-checking, and how the government might go about regulating the industry."

Syracuse University professor Jennifer Grygiel called the hearings "an important milestone."

"This is a first step in the process of writing much needed regulation," she said.

"It is clear from congressional testimony that self-regulation alone is not working and that regulatory oversight is needed in the United States in order to ensure safe social media."

'GLARING GAPS' IN UNDERSTANDING 

Noting that a European data protection standard due to come into effect on May 25 was more stringent than what was currently in place at Facebook, Zuckerberg suggested it could serve as a rough model for US rules in the future.

Facebook is implementing the General Data Protection Regulation (GDPR) standard for European users next month, and some of its rules will be extended to US and other users later, he confirmed.

"The GDPR requires us to do a few more things and we are going to extend that to the world," he said.

By one measure, Zuckerberg succeeded in his Washington appearance. Facebook shares rose five percent on Tuesday and added another 0.78 percent Wednesday in what was seen as a sign of confidence in the company after steep losses in recent weeks.

"To me, he came across as very conciliatory, especially when he took full responsibility for the mistakes of his company," said Jessica Vitak, head of the University of Maryland's Privacy and Education Research Lab.

"This seems to be a relatively new approach for the company and I believe at least in part responding to critique of Facebook's slow and somewhat tone-deaf response to prior breaches that have led to user outrage."

Others noted however that lawmakers had demonstrated little knowledge of how Facebook works -- potentially complicating any regulatory effort.

"Perhaps the most important revelation of Zuckerberg's testimony are the glaring gaps in our lawmakers' understanding of the internal logic and business model of Facebook," Young said.

"No one is going to be able to sufficiently regulate' Facebook until lawmakers are adequately educated about how it works."

source: news.abs-cbn.com

Facebook CEO says his own data was shared with Cambridge Analytica

WASHINGTON/SAN FRANCISCO - Facebook Inc Chief Executive Mark Zuckerberg on Wednesday told lawmakers that his own personal data was included in that of 87 million or so Facebook users that were improperly shared with political consultancy Cambridge Analytica.

But he pushed back on congress members' suggestions that users do not have enough control of their data on Facebook in the wake of the privacy scandal at the world's largest social media network.

"Every time that someone chooses to share something on Facebook ... there is a control. Right there. Not buried in the settings somewhere but right there," the 33-year-old internet magnate told the U.S. House of Representatives Energy and Commerce Committee.

Once again wearing a dark suit instead of his usual gray T-shirt, the hearing was Zuckerberg's second in two days. On Tuesday, he took questions for nearly five hours in a U.S. Senate hearing without making any further promises to support new legislation or change how the social network does business, foiling attempts by senators to pin him down.

Investors were impressed with his initial performance. Shares in Facebook posted their biggest daily gain in nearly two years on Tuesday, closing up 4.5 percent. They were down 0.7 percent in early trading on Wednesday.

Facebook has been consumed by turmoil for nearly a month, since it came to light that millions of users' personal information were wrongly harvested from the website by Cambridge Analytica, a political consultancy that has counted U.S. President Donald Trump's election campaign among its clients.

Zuckerberg faced broad concerns from members of Congress about how Facebook shares user data.

"How can consumers have control over their data when Facebook does not have control over the data?" asked Representative Frank Pallone of New Jersey, the ranking Democrat on the Energy and Commerce committee.

The latest estimate of affected users is up to 87 million.

Patience with the social network had already worn thin among users, advertisers and investors after the company said last year that Russia used Facebook for years to try to sway U.S. politics, an allegation Moscow denies.

Lawmakers have sought assurances that Facebook can effectively police itself, and few came away from Tuesday's hearing expressing confidence in the social network.

"I don't want to vote to have to regulate Facebook, but by God, I will," Republican Senator John Kennedy told Zuckerberg on Tuesday. "A lot of that depends on you."

Zuckerberg deflected requests to support specific legislation. Pressed repeatedly by Democratic Senator Ed Markey to endorse a proposed law that would require companies to get people's permission before sharing personal information, Zuckerberg agreed to further talks.

"In principle, I think that makes sense, and the details matter, and I look forward to having our team work with you on fleshing that out," Zuckerberg said.

(Reporting by Dustin Volz and David Shepardson in Washington and David Ingram in San Francisco Editing by Bill Rigby and Susan Thomas)

source: news.abs-cbn.com

'My mistake': Key Zuckerberg quotes in Senate Facebook grilling

WASHINGTON - Facebook chief Mark Zuckerberg appeared before US lawmakers Tuesday to apologize for how his company has handled the growing furor over online privacy, to promise change, and explain the social media giant's policies.

The wide-ranging questions -- including about Cambridge Analytica, which used data scraped from 87 million Facebook users to target political ads ahead of the 2016 US election -- put the 33-year-old billionaire under a microscope for several hours at a joint Senate committee hearing.

Here are top quotes from Zuckerberg, and some of the dozens of senators who grilled him. 

SETTING THINGS STRAIGHT 

"We didn't take a broad enough view of our responsibility, and that was a big mistake. And it was my mistake, and I'm sorry. I started Facebook, I run it, and I'm responsible for what happens here."

"When we heard back from Cambridge Analytica that they had told us that they weren't using the data and deleted it, we considered it a closed case. In retrospect, that was clearly a mistake. We shouldn't have taken their word for it. We've updated our policy to make sure we don't make that mistake again."

"It will take some time to work through all the changes we need to make across the company. I'm committed to getting this right. This includes the basic responsibility of protecting people's information, which we failed to do with Cambridge Analytica."

"We're investigating every single app that had access to a large amount of information in the past. And if we find that someone improperly used data, we're going to ban them from Facebook and tell everyone affected.

RUSSIAN ALARM 

"One of my greatest regrets in running the company is that we were slow in identifying the Russian information operations in 2016."

"There are people in Russia whose job it is to try to exploit our systems and other internet systems.... So this is an arms race. They're going to keep getting better and we need to invest in getting better at this too."

TRUMP AND SPECIAL COUNSEL 

Asked if Facebook executives have been interviewed by special counsel Robert Mueller, who is investigating Russian interference in the US election: "Our work with the special counsel is confidential.... I actually am not aware of a subpoena. I believe there may be, but I know we're working with them."

"I know we did help out the Trump campaign overall in sales support in the same way we do with other campaigns."

CHALLENGES AHEAD 

"There will always be a version of Facebook that is free."

"We need to take a more active view in policing the ecosystem and watching and looking out and making sure that all the members in our community are using these tools in a way that's going to be good and healthy."

Asked if he believes the social media giant, with over two billion users worldwide, amounts to a monopoly: "It certainly doesn't feel like that to me."

RIGHT TO PRIVACY

Senator Dick Durbin: "Would you be comfortable sharing with us the name of the hotel you stayed in last night? If you messaged anybody this week, would you share with us the names of the people you've messaged?"

Zuckerberg: "Senator, no I would probably not choose to do that publicly here."

Durbin: "I think that may be what this is all about: your right to privacy, the limits of your right to privacy, and how much you give away in modern America in the name of connecting people around the world."

PRESSURE IS ON

Senator John Thune: "This should be a wake-up call for the tech community.... We're listening, America is listening, and quite possibly the world is listening too."

Senator Bill Nelson: "Let me just cut to the chase. If you and other social media companies do not get your act in order, none of us are going to have any privacy anymore."

source: news.abs-cbn.com