Zuckerberg knew of ‘problematic’ privacy practices, report says

Facebook Inc. uncovered emails that seem to show Chief Executive Mark Zuckerberg was aware of potentially problematic privacy practices at the company, the Wall Street Journal reported, citing people familiar with the matter.

The social media giant discovered the emails in the process of responding to a federal privacy investigation, the Journal reported, raising concerns that it would be harmful to the company if they became public. The potential impact of the internal emails was part of the reason the company sought to reach a quick settlement of the investigation by the Federal Trade Commission, the Journal reported, citing one person familiar with the matter.

The FTC has been looking into whether Facebook violated the terms of its 2012 consent decree with the agency related to privacy issues, and the emails sent around that time suggest that Zuckerberg and other senior executives didn’t put compliance with the FTC order at the top of priorities, according to the Journal.

Facebook shares fell 1.7% to $175.04. The stock has gained 33% this year.

“We have fully cooperated with the FTC’s investigation to date and provided tens of thousands of documents, emails and files,” a Facebook representative said in a statement. “At no point did Mark or any other Facebook employee knowingly violate the company’s obligations under the FTC consent order nor do any emails exist that indicate they did.”

The Journal said it couldn’t be determined exactly what emails the FTC has requested and how many of them relate to Zuckerberg. It’s also unclear whether any of the emails, described to the Journal, show evidence that the company violated the 2012 agreement.

Facebook is at the center of numerous investigations over misinformation and privacy on the social network, and some politicians have called for the company’s breakup. Scrutiny has intensified since reports emerged in March 2018 that the company allowed the personal details of tens of millions of users to be shared with political consultancy Cambridge Analytica. Its repeated mishandling of user data is likely to result in a record-breaking fine from the FTC, with the company in April estimating the loss related to any settlement could be as high as $5 billion.

Seeking to stem the tide of criticism, Zuckerberg in March called for new global regulations governing the internet, recommending governments come up with rules on hateful and violent content, election integrity, privacy and data portability. He also announced that Facebook would overhaul its platform to focus on private, ephemeral and encrypted communication, an effort he said would alleviate users’ fears around privacy.

Kurt Wagner of Bloomberg contributed to this report.