Facebook faces loss of $70 billion since data breach news surfaced

11:20 AM | 27 Mar, 2018
Facebook faces loss of $70 billion since data breach news surfaced
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WASHINGTON - In what appeared to be a major blow to Facebook, the social networking giant's shares continued to nosedive on Monday after A US consumer protection agency launched a probe into the alleged misuse of 50 million users' data by Cambridge Analytica.

The Federal Trade Commission (FTC), which normally avoid commenting about the investigations, confirmed that an inquiry had been opened to check how Facebook granted the British consulting group Cambridge Analytica access to data of millions of its users.

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The agency will probe whether the social networking site mishandled the privacy of users or breached a 2011 agreement.

"The FTC is firmly and fully committed to using all of its tools to protect the privacy of consumers," said acting consumer protection chief Tom Pahl.

"Foremost among these tools is an enforcement action against companies that fail to honour their privacy promises, including to comply with Privacy Shield (the US-EU privacy accord), or that engage in unfair acts that cause substantial injury to consumers in violation of the FTC Act."

Since March 17, when news surfaced that data from a staggering 50 million Americans was used by Cambridge Analytica for devising digital media strategy for Donald Trump before the 2016 presidential elections, Facebook faced a loss over $70 billion in the market till Monday.

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According to Financial Post, Facebook shares fell as much as 6.5 per cent, briefly dipping below US$150 for the first time since July 2017, before recovering the day’s losses to close up 0.4 per cent at US$160.06.

 

Besides setback in the market, Facebook's owner Mark Zuckerburg is facing rising discontent from advertiser and users.

The media outlet claimed that U.S. auto parts retailer Pep Boys on Monday has pulled out all advertising on Facebook. Earlier, Mozilla Corp and Germany’s second largest bank Commerzbank had suspended the advertisement to the social networking site.