Facebook under investigation over whistleblower claims

·2 min read
Former Facebook employee and whistleblower Frances Haugen
Former Facebook employee and whistleblower Frances Haugen

Facebook is being investigated by government agencies after a whistleblower claimed that the company misled investors and has failed to protect children.

The social media company revealed that documents released by Frances Haugen, a former manager who has accused the company of putting profit over safety, are now the subject of official inquiries.

Facebook did not identify the government agency or country behind the investigation. However, Ms Haugen has filed documents with the US Securities and Exchange Commission (SEC) in which she claims that the business illegally misled investors about its popularity among younger users and how it deals with hate speech.

In a US filing, Facebook said: “Beginning in September 2021, we became subject to government investigations and requests relating to a former employee's allegations and release of internal company documents concerning, among other things, our algorithms, advertising and user metrics, and content enforcement practices, as well as misinformation and other undesirable activity on our platform, and user well-being."

A spokesman said: “We are always ready to answer regulators’ questions and will continue to cooperate with government inquiries.”

Ms Haugen’s complaint to the SEC, based on internal documents taken from Facebook when she left the company, said that its problems are so severe that not disclosing them to investors amounts to a violation of US stock market rules.

She included claims that Facebook and its sister app Instagram were used to facilitate “human trafficking and domestic servitude”, amplified misinformation and hate speech, and have a negative effect on young girls.

Ms Haugen has also passed documents to the regulator saying that Facebook has failed to disclose a worrying decline in use among teenagers and young adults, leading to advertisers being overcharged “on a vast scale”.

Facebook has said that claims it is mischarging advertisers are false.

It has broadly dismissed Ms Haugen’s claims, saying it invests billions of dollars in safety and denying it puts profits above all else.

On Monday, chief executive Mark Zuckerberg said the company would be devoting more effort to younger users.

Speaking to analysts as Facebook unveiled a slowdown in revenue growth, he said: “We are retooling our teams to make serving young adults their north star, rather than optimising for the larger number of older people."

Facebook is already facing huge regulatory pressure in the US.

The Federal Trade Commission (FTC) is seeking to break up the company, claiming it broke monopoly laws, while prosecutors in dozens of US states have launched their own lawsuit.

The SEC, FTC and the New York Attorney General, which is leading the states’ case, declined to comment on whether they were investigating Ms Haugen’s revelations.

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