Even after years of complaints in Washington over Facebook’s conduct, there have been few serious consequences for the social media network -- which is worth almost $900 billion and has nearly 3 billion users. Years of contentious congressional hearings have yet to result in meaningful regulation, and billions of dollars worth of fines from U.S. and European regulators have done little to change the company’s business model or behavior.
The AELP letter argues that not only are fines insufficient to deter corporate wrongdoing, but that the company’s executives personally profited from criminal activity. “We’re not in favor of fines, because over the years they’ve proven to be pretty ineffective,” Krista Brown, a senior policy analyst for the group, said in a phone interview.
The SEC, which brings only civil, not criminal cases, is likely already looking into whether Facebook misled investors, given the high profile nature of Haugen’s complaints, according to David Rosenfeld, a Northern Illinois University professor who previously helped lead enforcement in the SEC’s New York office. Whether the SEC would investigate individual executives “depends on their involvement, their personal knowledge, whether they knew about the issue and a level of intent to deceive or defraud,” Rosenfeld said.
The court cases cited in the letter are DZ Reserve v. Facebook and the Employees’ Retirement System of Rhode Island v. Facebook.
This article was provided by Bloomberg News.