Facebook is in hot water again. A whistleblower has accused the giant on social media of placing profits above controls on hate speech and misinformation. The company describes the allegations as “misleading”. They are once again offering the reputation of Facebook. It has received repeated hits since the Cambridge Analytica scandal three years ago.
The queue has already shifted to regulatory issues. Former Facebook product manager Frances Haugen and her lawyers have applied at least eight complaints with the U.S. Securities and Exchange Commission. It accuses Facebook of misleading investors with disclosure that is inconsistent with internal action against misinformation.
It is unclear whether the complaints are based on financial files or public statements. It can be difficult to file a lawsuit based on statements that do not have the status of official disclosures. The SEC will have to prove that there are material misstatements and omissions that adversely affect investors. But there were precedents.
SeaWorld, for example, has been accused of misleading investors about the damage the critical documentary has done Blackfish. The theme park operator finally agreed $ 5 million paid to settle those charges.
In the wake of the Cambridge Analytica leaks, Facebook had to $ 100 million paid SEC allegations that it made misleading revelations about the risks of misuse of user data have been settled. It was on top of that $ 5 billion it pays in a separate settlement with the Federal Trade Commission.
None of the disputes delayed the rise of Facebook. The company continued to withdraw advertising money, handing it over with its fist. Analysts expect net income to grow by a third to more than $ 40 billion this year. The share price fell by 5% on Monday, but has remained 81% higher over the past two years for a market value of almost $ 1 ton.
Critics may argue that the latest attack on Facebook shows that the company is struggling to balance social responsibility with competing threats likes TikTok. But Facebook has repeatedly proven that scandals do little to deter users and advertisers. This time will probably not be different.