On October 28, the U.S. Senate Commerce Committee held a hearing about the liability of big tech companies in bad behavior occurring on their sites. Among other tech executives, Facebook CEO Mark Zuckerberg provided testimony and answered questions from Senators. Ahead of the hearing, the National Whistleblower Center (NWC) sent a letter to the Committee urging them to consider SEC whistleblower complaints regarding misrepresentations made by Facebook.
Since 2016, NWC has supported a number of anonymous whistleblowers in filing SEC whistleblower complaints concerning misrepresentations and misleading omissions by Facebook about three serious issues on the site: illegal wildlife trafficking, antiquities trafficking, and terror and hate content. The petitions all claim that Facebook has been misleading in their public comments about their handling of these issues.
For example, according to Sharon Y. Eubanks, NWC’s Chief Counsel, “Facebook’s role in auto-generating pages for hate and terror groups wholly undermines claims by Facebook that it bars hate and terror groups and otherwise serves as a content-neutral platform. There is a great divide between Facebook’s statements to shareholders and the reality of its handling of hate and terror groups.”
While Section 230 of the Communications Decency Act largely shields tech companies from liability for behavior on their sites, NWC argues that as a publicly-traded company Facebook is beholden to U.S. securities laws and is violating the laws by making misleading statements to the public.
In their letter to the Committee, NWC outlined Facebook’s history of misleading statements on these issues and asked the Committee “to force Facebook to explain, under oath and with specificity, what it is doing to address these problems.”
On October 29, NWC Executive Director John Kostyack published a piece reacting to the previous day’s hearing and expressing disappointment in the proceedings. He writes that “on perhaps the most important question of the day – whether these companies are finally accepting responsibility for doing all that is necessary to address the growth of criminal and extremist activity on their websites – little progress was made.”
Additionally, Kostyack recounts specific answers by Zuckerberg that “effectively shreds what remains of his and his company’s credibility.” For example, Senator Gary Peters (D-MI) asked Zuckerberg about a recently leaked internal company analysis which shows that “64 percent of people who joined an extremist group on Facebook only did so because the company’s algorithm recommended it to them.” Zuckerberg claimed to be unfamiliar with the analysis.
In concluding his piece, Kostyack writes: “Zuckerberg expressed pride yesterday about the transparency reports that Facebook releases to the public each quarter. But these reports consistently paint a rosy picture, never acknowledging that the company’s algorithms and auto-generation features are assisting white supremacists and other extremist groups with networking and recruiting. Until Facebook comes clean about these critical facts, Congress and the SEC have every reason to look skeptically on its claims of transparency.”
NWC has since sent out an “Action Alert” asking individuals to write to their representatives and the SEC Commissioners today. “The Securities and Exchange Commission needs to investigate and hold Facebook accountable for its deceptive practices,” the alert states.