Facebook, Other Tech Giants Scrutinized by Congress Over User Data
March 19 2018 - 1:44PM
Dow Jones News
By Byron Tau
WASHINGTON -- Lawmakers are pushing for an aggressive inquiry
into allegations that a firm tied to President Donald Trump's
presidential campaign gathered data from millions of Facebook Inc.
profiles without authorization, calling for hearings on Capitol
Hill and possible additional regulation of digital advertising.
Republican and Democratic lawmakers are calling for the top
executives of tech companies including Facebook, as well as
Alphabet Inc.'s Google and Twitter Inc., to appear before Congress
to explain how they protect user data from being exploited by
third-party companies for advertising and other targeting
purposes.
Last week, Facebook said it suspended the firm Cambridge
Analytica from its platform after reports the firm had violated
Facebook policies that govern how third-party developers can deploy
user data they obtained from the company.
The firm, which worked for Republican presidential candidates
including Mr. Trump and Sen. Ted Cruz during the 2016 campaign, was
financed in part by a major Republican donor. It was founded on the
premise of using cutting-edge social science to deliver better
targeting to political campaigns.
"Facebook, Google, and Twitter have amassed unprecedented
amounts of personal data and use this data when selling
advertising, including political advertisements. The lack of
oversight on how data is stored and how political advertisements
are sold raises concerns about the integrity of American elections
as well as privacy rights," said Sens. Amy Klobuchar (D., Minn.)
and John Kennedy (R., La.) in a joint statement on Monday.
The senators said testimony from the companies' CEOs would
provide an update on steps being taken to block foreign
interference in U.S. elections and how the companies are protecting
Americans' data.
The bipartisan duo are both members of the Judiciary committee
and have asked the panel's chairman, Chuck Grassley (R., Iowa), to
hold hearings. A spokesman for Mr. Grassley didn't immediately
return a request for comment.
They join others on Capitol Hill and in Europe calling for
additional scrutiny of both tech companies and Cambridge's
practices. Other senior members of Congress are calling for either
additional investigations or renewed steps to curb abuse in digital
advertising.
"This is a big deal, when you have that amount of data. And the
privacy violations there are significant," Sen. Jeff Flake (R.,
Ariz.), a member of the Senate Judiciary Committee, said in an
appearance on CNN. "So, the question is, Who knew it? When did they
know it? How long did this go on? And what happens to that data
now?"
"This is more evidence that the online political advertising
market is essentially the Wild West," said Sen. Mark Warner (D.,
Va.), vice chairman of the Senate Intelligence Committee. "It's
clear that, left unregulated, this market will continue to be prone
to deception and lacking in transparency."
Facebook shares were down 7% at midday Monday. Pivotal Research
analyst Brian Wieser said the weekend's episode was another sign of
"systemic problems" within the company, elevating the risk that
Facebook face further regulation. Mr. Wieser has a "sell" rating on
the stock.
Mr. Warner's panel held a hearing last year about the use of
Facebook by actors linked to the Russian government as part of a
propaganda campaign aimed at disrupting the U.S. election. Mr.
Warner and Ms. Klobuchar have coauthored legislation that would
force additional disclosures about political disclosures on
Facebook.
Facebook said it had learned in 2015 that Aleksandr Kogan, a
psychology professor at the University of Cambridge in the U.K.,
broke its data policies when he shared user data gleaned from his
personality-prediction app, "thisisyourdigitallife," to third
parties including Cambridge Analytica and Christopher Wylie, who
runs a company called Eunoia Technologies Inc.
About 270,000 people downloaded the app, giving Mr. Kogan access
to information such as the cities they lived in, the content they
had liked, or information about their friends, Facebook Deputy
General Counsel Paul Grewal wrote in a blog post. According to a
report in the New York Times, as many as 50 million Facebook users
were ultimately swept up in the data collection.
A Cambridge Analytica spokesman said in a statement that its
political division didn't use Facebook data collected by Mr.
Kogan's company. The firm said that it deleted all data it received
after it became clear that Mr. Kogan violated Facebook's
policies.
A Facebook spokesman said the parties, including Cambridge
Analytica, entered legal agreements on the deletion, but Facebook
couldn't independently verify that it was scrubbed. The company has
since changed its data policies so developers can't easily gather
as much data about Facebook users, it said.
--Deepa Seetharaman contributed to this article.
Write to Byron Tau at byron.tau@wsj.com
(END) Dow Jones Newswires
March 19, 2018 13:29 ET (17:29 GMT)
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