Non-profit organization calls for criminal investigation against Zuckerberg and Sandberg | Social Media News

A liberal nonprofit wants US federal authorities to investigate whether Meta (formerly Facebook) co-founder and CEO Mark Zuckerberg and COO Sheryl Sandberg broke the law.

A liberal nonprofit that champions market competition is urging federal authorities to investigate whether executives including Mark Zuckerberg and Sheryl Sandberg broke the law, adding personal charges to the allegations the company faces following the revelations of a whistleblower.

The Washington-based American Economic Liberties Project is sending a letter Friday to heads of the Department of Justice, the Securities and Exchange Commission and the Federal Trade Commission, offering examples of what it has identified as wrongdoing potential and calling on agencies to investigate.

The allegations include that executives inflated video metrics and misled advertisers; miscounted users and distorted ad reach; failed to disclose inaccurate user counts; and lied to Congress about user control over data. The group said the allegations warrant a criminal investigation, but it’s unclear whether the letter will prompt federal authorities to act.

Facebook declined to comment on the letter and a description of the allegations it contained.

The left-leaning nonprofit was founded in early 2020 by advocates for tougher antitrust enforcement. The group applauded the Biden administration’s appointment of Lina Khan as FTC chairman and Jonathan Kanter as head of the DOJ’s antitrust division. He has also backed bills aimed at targeting big tech companies for their dominance, acquisition strategy and treatment of competitors.

Funding for the group comes from foundations and individuals, including the Economic Security Project, the Omyidyar Network and the Nathan Cummings Foundation.

Chris Hughes, who started Facebook with Zuckerberg and has been an outspoken critic ever since, is the co-chair of the Economic Security Project. Other entities associated with tech billionaire Pierre Omidyar have also backed Frances Haugen, the former Facebook employee turned whistleblower.

Facebook, which announced Thursday it was changing its corporate name to Meta Platforms Inc., has come under fire on multiple fronts in Washington since Haugen handed over a trove of internal documents to the SEC, Congress and reporters. Friday’s letter cites documents related to two ongoing court cases, as well as Haugen’s records revealing internal Facebook discussions.

“It is clear that Facebook executives simply do not believe they will ever face meaningful penalties for unlawful behavior,” according to the letter, which was obtained by Bloomberg. “Facebook’s long-standing record of unethical and potentially illegal behavior merits criminal sanction.”

Haugen has filed eight complaints with the SEC based on its filings, and the FTC was already challenging the company’s previous acquisition of Instagram and Whatsapp. But opening new investigations to hold the leaders personally accountable would be a new strategy for federal authorities.

Even after years of complaints in Washington about Facebook’s conduct, there have been few serious consequences for the social media network – which is worth nearly $900 billion and has nearly 3 billion users. Years of contentious congressional hearings have yet to result in meaningful regulation, and billions of dollars in fines imposed by U.S. and European regulators have done little to change the business model or behavior. of the company.

The AELP letter argues that not only are the fines insufficient to deter companies from wrongdoing, but that company executives have personally profited from criminal activity. “We’re not in favor of fines because over the years they’ve proven to be quite ineffective,” Krista Brown, the group’s senior political analyst, said in a phone interview.

The SEC, which only handles civil, not criminal cases, is likely already investigating whether Facebook misled investors, given the high-profile nature of Haugen’s complaints, according to Northern Illinois University professor David Rosenfeld. who previously helped lead the SEC’s enforcement of the new law. York office. The SEC’s decision to investigate individual executives “depends on their involvement, personal knowledge, knowledge of the issue, and intent to deceive or defraud,” Rosenfeld said.

The court cases cited in the letter are DZ Reserve v. Facebook and the Rhode Island Employee Retirement System v. Facebook.