Last week Facebook saw it’s share price plummet in the wake of the privacy scandal surrounding Cambridge Analytica. Cambridge Analytica which is based in the UK has been accused of using the data of some 50 million Facebook users. It is alleged that this data was used to influence the recent U.S. presidential campaign which placed Donald Trump in the Oval Office. Cambridge Analytica may have also influenced the vote in the Brexit referendum in 2016. Both Facebook and Cambridge Analytica are now firmly in the centre of a dispute over the harvesting and use of personal data. Both firms deny any wrongdoing.

The background to all this started in 2014. Aleksandr Kogan, an academic at Cambridge University (the university itself has no connections with Cambridge Analytica) developed a Facebook app where users were invited to take part in a personality quiz. Such apps at the time were commonplace and it was designed to harvest data of the person taking the quiz and also the data of their friends. Recently, Facebook has changed the guidelines on this data scraping method.

Christopher Wylie, an employee at Cambridge Analytica, alleges that some 270,000 people took the Facebook quiz. From the 270,000 users friends, the data of 50 million users mainly within the U.S. was harvested without their consent. He goes on to claim that this data was then sold to Cambridge Analytica. It is further claimed by Mr. Wylie that Cambridge Analytica then psychologically profiled the users and targeted them to deliver a pro-Trump material to them. Cambridge Analytica denies that any of this data was used as part of it’s services to the Trump campaign.

Although the data was gathered using Facebook at the time, this data was not authorised for them to share with a third-party. The other key point is that users taking part in the quiz would have no idea that they were potentially sharing data with the Trump campaign. Facebook state that when they learned their guidelines were breached, the app was deleted off the platform. Facebook then demanded assurances that the data gathered via the app was deleted.

Cambridge Analytica claim they never used the data and deleted it when Facebook told them to.

Both Facebook and the UK Information Commissioner want to find out if the data was properly destroyed.

U.S senators have called on Mark Zuckerburg, the Facebook CEO to testify before Congress about how Facebook will protect it’s 2.2 billion users. The chairman of the U.K. parliamentary committee, Damien Collins has summoned Mr. Zuckerburg to explain the ‘catastrophic failure’ to MPs. The head of the E.U. Parliament said it would also investigate to see if the data was misused.

Cambridge Analytica suspended it’s Chief Executive, Alexander Nix soon after the story broke saying his comments that were made during an undercover documentary on Channel 4:

‘Do not represent the values or operations of the company.’

Mark Zuckerburg finally addressed the world’s media mid-week, five days after the scandal broke. Whilst admitting mistakes were made, he also stated that steps have been taken a couple of years ago to prevent this from happening. He is seemingly saying ‘we have already fixed the problem’. He also added:

‘If we can’t protect you, we don’t deserve you.’

In the days leading up to this statement the hashtag ‘#deletefacebook’ was trending worldwide. Perhaps ten of thousands of users deactivated their Facebook account or completely deleted it. Many users are reeling from the revelation that Facebook apps were harvesting their data. For the publications and academics that have been closely following Facebook for years, this isn’t news. For everyone else, it is timely wake-up call. Oddly, the #deletefacebook hashtag was tweeted by Whatsapp co-founder Brian Acton, Whatapp itself is owned by Facebook.

The steps that Facebook have and are going to take are the following:

  • investigate all Facebook apps that had access to large amounts of information before the platform was changed “to dramatically reduce data access” in 2014
  • conduct a “full forensic audit” of any app with suspicious activity
  • ban any developer that did not agree to a thorough audit
  • ban developers that had misused personally identifiable information, and “tell everyone affected by those apps”.

In future, he said Facebook would:

  • restrict developers’ data access “even further” to prevent other kinds of abuse
  • remove developers’ access to a user’s data if the user hadn’t activated the developer’s app for three months
  • reduce the data that users give an app when they sign in to just name, profile photo, and email address
  • require developers to obtain approval and also sign a contract in order to ask anyone for access to their posts or other private data.

However, some advertisers are now threatening to ditch Facebook. The ISBA, a group of leading advertisers that sink millions of pounds into Facebook advertising whose brands include Unilever and P&G have threatened to pull their adverts from Facebook. That is if the data is found to have influenced elections and benefitted political groups. Even Facebook’s own shareholders have filed a class-action lawsuit claiming that the falling share price has caused them significant losses and damages as a result of Facebook’s omissions and wrongful acts. More lawsuits have also been filed over the course of last week. It is also alleged that Mark Zuckerburg sold some of his own shares in Facebook before the scandal broke saving himself millions of dollars, leading to questions of whether he knew of the forthcoming scandal.

Clearly, this story is far from over.

Sources

http://www.bbc.co.uk/news/technology-43465968
http://www.bbc.co.uk/news/world-us-canada-43494337
https://www.thetimes.co.uk/edition/news/advertisers-threaten-to-pull-out-of-facebook-over-cambridge-analytica-lkjp9t0fl
https://www.independent.co.uk/news/business/news/facebook-cambridge-analytica-shareholders-sue-lawsuit-share-price-falls-data-privacy-scandal-a8267081.html
https://nypost.com/2018/03/20/zuckerberg-dumped-a-boatload-of-facebook-shares-before-stock-nosedive/