Facebook Data Breach Rocks Firm, Shares Down Over 40%

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Facebook data breach

Cambridge Analytica Collected Data On 50 Million Facebook Profiles

Shares in social media giant Facebook are now down over 40% since last Friday in response to reports that British data analytics company Cambridge Analytica had gained access to private data from over 50 million Facebook profiles. The group is being accused of using the data to promote “fake news” which is said to have had a significant influence on the outcome of the 2016 Brexit vote and Presidential elections.  As well as illegal data use, the firm is being investigated on accusations of psychological manipulation and entrapment methods.

The revelation was aired during a UK news broadcast during which showed Cambridge analytica CEO Alexander Nix, caught on camera suggesting that the group could use strategically use sex workers alongside bribes and misinformation (fake news) to sway political favour around the world.

The investigation by Channel 4 news, in the UK, came on the back of articles published by both the New York Times and the U Observer revealing how the analytics firm came to access over 50 million Facebook profiles.

Global Science Research Involved

The reports showed that Global Science Research, headed by academic Aleksandr Kogan, created an app called “thisisyourdigitallife” an app where users were paid for undertaking a psychological test. However, the app also collected data from the user’s facebook profile and the aggregated data was then sold to Cambridge Analytica.

Whistleblower Claims US Elections Involvement

According to information from Cambridge Analytica whistleblower; Christopher Wylie, this data was then used by the firm to build a software solution used to sway sentiment in the US elections. Wylie claims that the firm used the data to build “psychographic” profiles of pro-Trump supporters and syphon propaganda materials to them in a bid to build support for Trump’s campaign.

Facebook has responded firmly to these allegations saying that; it collected all data through legitimate means and also claimed that it had been “lied” to by Kogan who violated its internal policies on transferring data.

Kogan’s app was indeed banned by Facebook in 2015 and the app’s developer and all other parties involved had been ordered to destroy all data collected. However, it appears that this data was not destroyed and instead was used nefariously.

Facebook Statement

In a statement released earlier in the week Facebook said “The entire company is outraged that we were deceived. We are committed to vigorously enforcing our policies to protect people’s information and will take whatever steps are required to see that this happens,” adding that it would “work around the clock to get all the facts.”

The scandal has raised significant questions about the way in which analytics firms and other corporate entities are able to garner influence in political events through targeted media campaigns. During both the Brexit vote and US elections, so called “fake news” became ever important with mis-information plaguing the campaign and even making it out of the online environment and into mainstream news reports.

US Senators Urge Zuckerberg Testimony

US Senators are now calling for Facebook boss; Mark Zuckerberg, to testify before congress, answering questions about how the social media group intends to protect its users from further privacy breaches of this type. In the UK, the chariman of the parliamentary committee has summoned Zuckerberg to answer questions and explain how this “catastrophic failure” took place.

Meanwhile, a statement released by Cambridge Analytica said that “In the view of the board, Mr Nix’s recent comments secretly recorded by Channel 4 and other allegations do not represent the values or operations of the firm and his suspension reflects the seriousness with which we view this violation”. Nix is currently suspended from his post in response to the report by Channel 4.

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With over 6 years’ experience analysing currency markets, James is now a well-known industry analyst focusing on price action trading and fundamental drivers. Beginning as a private retail trader, James developed a strong interest in understanding the fundamental aspect of the market before pursuing technical trading capabilities which he now uses to identify opportunities over a short-term horizon. Alongside his market experience, James is also IMC certified having achieved the qualification to help further his understanding not only of the markets but the industry as a whole. James has a strong interest in both fundamentals and technicals and uses both forms of analysis in generating and executing trade ideas, with trades generally lasting from a few hours to a few days.

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With over 6 years’ experience analysing currency markets, James is now a well-known industry analyst focusing on price action trading and fundamental drivers. Beginning as a private retail trader, James developed a strong interest in understanding the fundamental aspect of the market before pursuing technical trading capabilities which he now uses to identify opportunities over a short-term horizon. Alongside his market experience, James is also IMC certified having achieved the qualification to help further his understanding not only of the markets but the industry as a whole. James has a strong interest in both fundamentals and technicals and uses both forms of analysis in generating and executing trade ideas, with trades generally lasting from a few hours to a few days.

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