Data mining scandal rocks Facebook to the core as shares tumble $50bn

Data mining scandal rocks Facebook to the core as shares tumble $50bn

For the first time ever, people are legitimately now asking whether Facebook can continue as an ongoing concern.

The world’s biggest social network has seen $50bn wiped from its value this week as the controversy surrounding its relationship with political strategists Cambridge Analytica continues to escalate.

CNN reports that Facebook shareholder Fan Yuan has filed a lawsuit in the US accusing the company of making “materially false and misleading statements" about its privacy policies, thus consequentially robbing stakeholders of their share cash.

The crux of the matter will be whether Facebook willingly allowed CA to mine the data of its users, or whether this was done without its knowledge and consent.

Facebook has not said much since the crisis erupted, but has insisted that it did not knowingly compromise user data – a claim disputed both by the now sacked CA chief executive Alexander Nix, and a growing string of insiders in the press.

Is the end nigh?

“Mark [Zuckerberg], Sheryl [Sandberg] and their teams are working around the clock to get all the facts and take the appropriate action moving forward, because they understand the seriousness of this issue,” a Facebook statement released yesterday explains.

“The entire company is outraged 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.”

Zuckerberg himself has remained silent – a fact that is causing an increasing level of outrage. As well as criticism from governments, including the UK, Facebook is now facing increasing heat from the public and peers. The #deletefacebook movement is rapidly growing, although how many users are actually abandoning the platform remains to be seen.

WhatsApp co-founder Brian Acton joined the chorus yesterday, saying that it was time for the social network to come to an end. Facebook acquired WhatsApp in 2014.

The Cambridge Analystica controversy invovles claims that the company worked with Facebook to acquire data on 50m Facebook users who were, on behalf of political entities, targeted in an effort to swing their votes. Donald Trump is known to have worked with the company, although it also appears to have ties to the Brexit campaign.