By David Ingram
SAN FRANCISCO (Reuters) – Facebook Inc Chief Executive Officer
The world’s largest social network is facing increasing government scrutiny in Europe and the United States over allegations by a whistleblower that London-based political consultancy Cambridge Analytica improperly accessed user information to create profiles of American voters that were then used to help elect U.S. President Donald Trump in 2016.
Zuckerberg, in his first public comments since the scandal broke over the weekend, said in a Facebook post that the company “made mistakes, there is more to do and we need to step up and do it.”
He did not elaborate on what the errors were, but said the social network plans to conduct an investigation of apps on its platform, restrict developers’ access to data and give members a tool that allows them to more easily disable access to their Facebook data.
It did not explicitly apologize for the misuse of data, and its plans did not represent a major reduction in advertisers’ ability to use Facebook data, which is the company’s lifeblood.
Facebook shares pared gains Wednesday after Zuckerberg’s post, closing up 0.7 percent. The company has lost more than $45 billion of its stock value in the past three days as investors fear that any failure by big tech companies to protect personal data could deter advertisers and users and prompt tougher regulation.
Facebook representatives, including deputy chief privacy officer Rob Sherman, met with congressional staff for nearly two hours on Wednesday and planned to continue the meetings on Capitol Hill on Thursday. Facebook was unable to answer many questions, said two aides who attended the briefing.
The whistleblower who started the scandal, Christopher Wylie, formerly of Cambridge Analytica, said in a tweet that he had accepted invitations to testify before US and British lawmakers.
‘SCAPEGOAT’
On Tuesday, Cambridge Analytica’s board suspended its chief executive, Alexander Nix, who was caught on a secret recording bragging that his company played a decisive role in Trump’s victory.
But the academic who provided the data denied this on Wednesday.
“I think what Cambridge Analytica has tried to sell is magic, and they’ve claimed that it’s incredibly accurate and that it tells you everything there is to tell you about yourself. But I think the reality is that it doesn’t,” psychologist Aleksandr Kogan, an academic at the University of Cambridge, told the BBC in an interview broadcast on Wednesday.
Kogan, who collected the data using a Facebook survey app, also said he was being used as a scapegoat by Facebook and Cambridge Analytica. Both companies have blamed Kogan for the alleged misuse of the data.
Only 300,000 Facebook users responded to Kogan’s questionnaire, but that gave the researcher access to the Facebook friends of those people who had not agreed to share information, yielding details on 50 million users.
Facebook has said it subsequently made changes that prevent people from sharing data about friends and maintains that no data leak occurred because the original users gave their permission. Critics say that, in essence, it was a leak because data was taken from unsuspecting friends.
Facebook banned Cambridge Analytica from using any of its services on Friday.
Zuckerberg said the company will “further restrict access to developer data to prevent other types of abuse” and that the company is working with regulators as they investigate what happened.
Many analysts have expressed concern about the negative impact the incident could have on user engagement with Facebook, potentially reducing its influence with advertisers. Three Wall Street brokerages have cut their target prices.
“Investors now have to consider whether the company will conclude that it has grown in a way that has proven to be unsustainable or whether it needs to significantly improve its management,” said Pivotal Research Group analyst Brian Wieser.
Facebook shares have fallen more than 8 percent since Friday. The company has increased its value by more than 550 percent in the past five years.
(Reporting by David Ingram; Additional reporting by Dustin Volz and David Shepardson in Washington and Kate Holton in London; Writing by Susan Thomas; Editing by Bill Rigby and Lisa Shumaker)
