The Justice Department has been extremely busy this week, announcing last night that social networking giant Facebook is now under a federal grand jury investigation over its business practices involving customer data.
A grand jury in New York has subpoenaed records from at least two prominent makers of smartphones and other devices, according to two people who were familiar with the requests and who insisted on anonymity to discuss confidential legal matters. Both companies had entered into partnerships with Facebook, gaining broad access to the personal information of hundreds of millions of its users.
The companies were among more than 150, including Amazon, Apple, Microsoft and Sony, that had cut sharing deals with the world’s dominant social media platform. The agreements, previously reported in The New York Times, let the companies see users’ friends, contact information and other data, sometimes without consent. Facebook has phased out most of the partnerships over the past two years.
“We are cooperating with investigators and take those probes seriously,” a Facebook spokesman said in a statement. “We’ve provided public testimony, answered questions and pledged that we will continue to do so.”
It is not clear when the grand jury inquiry, overseen by prosecutors with the United States attorney’s office for the Eastern District of New York, began or exactly what it is focusing on. Facebook was already facing scrutiny by the Federal Trade Commission and the Securities and Exchange Commission. And the Justice Department’s securities fraud unit began investigating it after reports that Cambridge Analytica, a political consulting firm, had improperly obtained the Facebook data of 87 million people and used it to build tools that helped President Trump’s election campaign.
The Justice Department and the Eastern District declined to comment for this article.
The Cambridge investigation, still active, is being run by prosecutors from the Northern District of California. One former Cambridge employee said investigators questioned him as recently as late February. He and three other witnesses in the case, speaking on the condition of anonymity so they would not anger prosecutors, said a significant line of inquiry involved Facebook’s claims that it was misled by Cambridge.
If there's one thing that people on the left anf right can agree on, it's that Facebook and Mark Zuckerberg needs to burn, and it looks like we're headed for some fun ahead. There's the very real possibility that this will be settled as a fine and Facebook will throw a few hundred million dollars at the government to make this go away, but the company's stock is going to crater anyway, and maybe if Zuck loses a few billion off his net worth, so be it.
I still stand by Liz Warren's platform that Google and Facebook need to be broken up.
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