SAN FRANCISCO/LONDON (Reuters) - Facebook Inc said Tuesday it faced questions from the lead U.S. consumer regulator about how its users’ personal data was mined by a political consultancy hired by Donald Trump’s campaign.
U.S. and European lawmakers have demanded an explanation of how the consultancy, Cambridge Analytica, gained access to the data in 2014 and why Facebook failed to inform its users, raising broader industry questions about consumer privacy.
Facebook said on Tuesday it had been told by the Federal Trade Commission (FTC) that it would receive a letter this week with questions about the data acquired by Cambridge Analytica. It said it had no indication of a formal investigation.
“We remain strongly committed to protecting people’s information. We appreciate the opportunity to answer questions the FTC may have,” Facebook Deputy Chief Privacy Officer Rob Sherman said.
The FTC, the regulatory agency in charge of consumer protection, is reviewing whether Facebook violated a 2011 consent decree it reached with the authority over its privacy practices, a person briefed on the matter told Reuters.
“We are aware of the issues that have been raised but cannot comment on whether we are investigating. We take any allegations of violations of our consent decrees very seriously as we did in 2012 in a privacy case involving Google,” an FTC spokesman said.
Under the 2011 settlement, Facebook agreed to get user consent for certain changes to privacy settings as part of a settlement of federal charges that it deceived consumers and forced them to share more personal information than they intended, Bloomberg reported.
If the FTC finds Facebook violated terms of the consent decree, it has the power to fine the company thousands of dollars a day per violation.
Facebook will brief U.S. Senate and House aides on Wednesday, congressional staff said.
Facebook shares lost 5.7 percent in heavy trading to a six-month low, extending Monday’s 7-percent fall, and was set for its worst two-day drop since July 2012. Its market capitalization was down by another $25 billion as investors fretted the world’s largest social media network could face massive fines and that its dented reputation could scare off users and advertisers.
Shares of Snap Inc fell 4 percent and Twitter Inc was down 9.6 percent.
Facebook and its peers Alphabet Inc’s Google and Twitter face a backlash over their role during the U.S. presidential election by allowing the spread of false information that might have swayed voters toward Trump.
A Congressional official said House Intelligence Committee Democrats plan to interview Cambridge Analytica whistleblower Christopher Wylie. The committee has already interviewed by video teleconference Cambridge Analytica chief Alexander Nix, according to the Congressional official, but a transcript of that interview has not yet been made public.
The White House said the President believes that Americans’ privacy should be protected.