Mark Zuckerberg loses $5b as Facebook shares fall in data scandal

As Facebook shares slumped and erased $5billion from the net worth, Mark Zuckerberg, who is currently the seventh richest person in the world, holds roughly 400 million shares, or 16 percent, in Facebook.

The slumped was a result of the Cambridge Analytica scandal in which data of 50 million users was reportedly misused by working as a consultant for Donald Trump’s presidential campaign—allegedly ”harvested private information from the Facebook profiles of more than 50 million users without their permission,”Forbes reports.

On Wall Street, Facebook shares skidded 6.8 percent amid concerns about pressure for new regulations that could hurt its business model.

The reports have prompted a review by the company and expressions of concern by several US lawmakers who are demanding that Zuckerberg be grilled by the Senate Judiciary Committee.

Democratic Senator Amy Klobuchar and Republican John Kennedy called for Facebook Boss Mark Zuckerberg to appear before Congress, along with the CEOs of Google and Twitter.

The lawmakers said the companies “have amassed unprecedented amounts of personal data” and that the lack of oversight “raises concerns about the integrity of American elections as well as privacy rights.

Brian Wieser, analyst at New York-based brokerage Pivotal Research Group said,’We think this episode is another indication of systemic problems at Facebook,

” Regulatory risks for the company would intensify and enhanced use of data in advertising would be at greater risk than before.

Facebook’s deputy general counsel, Paul Grewal, called the incident “a scam — and a fraud.” “We will take whatever steps are required to see that the data in question is deleted once and for all — and take action against all offending parties,” he added. Cambridge Analytica was suspended from the platform soon after,”Times report.

Facebook announced on Monday that it had hired a digital forensics firm to investigate the handling of data leaked to a consulting firm.

The forensics firm Stroz Friedberg would ‘conduct a comprehensive audit of Cambridge Analytica,’ and that the company had agreed to comply and provide access to its servers and systems.

Britain, parliamentary committee chair Damian Collins said both Cambridge Analytica and Facebook had questions to answer.

“We have repeatedly asked Facebook about how companies acquire and hold on to user data from their site, and in particular whether data had been taken from people without their consent.

But their answers have consistently understated this risk, and have also been misleading to the committee.” he said.

Senator Amy Klobuchar tweeted on Saturday: ‘This is a major breach that must be investigated. It’s clear these platforms can’t police themselves.

‘I’ve called for more transparency & accountability for online political ads. They say ‘trust us.’ Mark Zuckerberg needs to testify before Senate Judiciary.’

Senator Ron Wyden asked Facebook to provide more information on what he called a “troubling” misuse of private data that could have been used to sway voters.  Wyden said he wants to know how Cambridge Analytica used Facebook tools “to weaponize detailed psychological profiles against tens of millions of Americans.”

 

In Europe, officials voiced similar outrage.  Vera Jourova, the European commissioner for justice, consumers and gender equality, called the revelations “horrifying, if confirmed,” and vowed to address concerns in the United States this week.  In Britain, parliamentary committee chair Damian Collins said both Cambridge Analytica and Facebook had questions to answer.

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