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Facebook's latest crisis is about its CEO, Mark Zuckerberg: What you need to know

The social network is already under fire for scandals involving election meddling and data privacy. Now its top leaders have come under the microscope.

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Facebook CEO Mark Zuckerberg

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Facebook is back in the hot seat after The New York Times published a more than 5,000-word investigative report about how its executives responded to a series of scandals.

The latest revelations come at a bad time for the world's largest social network, which is already having a rough year. From combating election meddling and hate speech to dealing with a massive security breach, the tech giant's woes keep piling up. It's trying to rebuild trust with its more than 2 billion monthly active users, but it also faces the potential of more regulation from lawmakers.

Here's what you need to know.

Why is Facebook under fire yet again?

The New York Times investigation focuses on how Facebook CEO Mark Zuckerberg, 34, and COO Sheryl Sandberg, 49, handled crisis after crisis over the last three years. The report was a biting criticism of their leadership, raising new questions about them, their role at Facebook and the company's future.

The executives "ignored warning signs and then sought to conceal them from public view," the paper wrote. They were also "distracted by personal projects and passed off security and policy decisions to subordinates."

Facebook tried to "deflect blame" and "mask" the extent of a data privacy scandal that came to light in March. Cambridge Analytica, a UK consulting firm, harvested the personal data of roughly 87 million Facebook users without their permission. 

The paper also said Facebook knew about Russian activity on the platform as early as spring 2016, more than a year before the company alerted the public. Sandberg clashed with Chief Security Officer Alex Stamos, who's since left the company, over how to handle the problem, according to the Times. 

Meanwhile, Facebook executives were apparently wrapped up in protecting the social network's image. To do that, the Times said, the company resorted to "aggressive" lobbying tactics and tapped its Washington connections to shift blame to tech rivals and ward off critics. At one point, the company hired a firm known for opposition research, Definers Public Affairs, which tried to discredit critics by linking liberal billionaire George Soros to activists protesting Facebook.  

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Why do people care so much about what Facebook does?

Facebook is the planet's biggest social network. With an active user base of roughly 2.3 billion people, its membership is larger than the population of any country on Earth. Yet, Facebook is a company. There are no elected representatives, and there's no court of appeals. It's just Zuckerberg, his executive team and the people they hire. 

This tension has been in the background since Facebook's founding in 2004. Nearly since the beginning, any time the company made big changes (like when it introduced the News Feed or when it forced people to download Messenger as a separate program), there were uproars from users frustrated by the company's unilateral moves.

When the 2016 election rolled around, we discovered Facebook was no longer just a place to share pictures of our kids or what we ate for lunch. Russian operatives had also learned it was an effective tool for interfering in elections by spreading misinformation.

Since then, Facebook's flatfooted responses, and the splintering controversies that arose around them, like the one involving Cambridge Analytica, have drawn ire from all over the globe.

How is this scandal different from others?

The social networking giant has faced four spiraling crises over the past year alone, but this one specifically involves the company's leadership and how it's responded to the problems. 

At the start of the year, Facebook's biggest ongoing scandal was the investigation into Russian interference in the 2016 US presidential election. The tech firm announced in 2017 that it had found evidence Russian operatives used the social network to purchase ads about politically divisive topics. But questions remain about when Facebook knew about Russian activity and if it acted quickly enough. This year, on the eve of the US midterm elections, Facebook pulled down more than 100 accounts that may've been tied to Russia's Internet Research Agency.

In March, the company faced a new scandal when The New York Times and the Guardian's Observer newspaper revealed that tens of millions of Facebook users' data was acquired by a political consulting firm called Cambridge Analytica. The scandal sparked concern about how well Facebook was safeguarding the trove of info it gathers about users. To make matters even worse, Facebook took nearly three years to alert users about the data misuse. The uproar prompted Zuckerberg to make a rare appearance before Congress. 

Then, in the summer, Facebook joined the rest of the tech industry when it banned far-right conspiracy theorist Alex Jones from its platform for violating its rules against hate speech and violent content. Jones has been widely criticized for spreading false stories, including one that claimed the mass shooting of 20 children and six adults at Sandy Hook Elementary School was a hoax. The ban reignited allegations that Facebook was censoring conservative voices, which the company has denied.

Criticism over how well Facebook has been protecting user data returned in September after the company disclosed a massive security breach. Hackers exploited code tied to the site's View As feature, which lets people see what their profiles look like to other users. That let attackers steal the personal information of 29 million Facebook users, including phone numbers, birth dates and hometowns. 

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Zuckerberg testified before Congress in April.

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OK, this controversy involves a firm called Definers Public Affairs. What's the deal with them?

Definers was founded by Republican political operatives. The Times said Definers circulated a research document and tried to press reporters to dig into financial ties between Soros and members of Freedom from Facebook, a coalition of Facebook critics that's urged regulators to break up the social media giant. 

The allegation doesn't bode well for Facebook, which is under pressure to combat misinformation and hate speech. Soros, a Hungarian Jewish billionaire, has publicly criticized Facebook in the past, but he's also been the target of anti-Semitic and far-right conspiracy theories, and a pipe bomb was delivered to his home in October. The fact that Facebook, through Definers, was pointing a finger at alleged behind-the-scenes activity by Soros played on the conspiracy theories, intentionally or not. Facebook partners and advertisers also said Definers' work revealed that Zuck & Co. were willing to use dirty politics to protect their brand.

Definers also focused on Facebook's tech rivals, the Times said. Some of the social network's critics in the wake of the Cambridge Analytica scandal have been other Silicon Valley companies and personalities, including Apple CEO Tim Cook. Definers has ties to a conservative news site, NTK Network, which published dozens of critical articles about Apple and Google.

And Definers targeted senators who questioned Sandberg during a congressional hearing in September, according to a separate Times story

Elliot Schrage, Facebook's outgoing head of public policy and communications, said in an internal memo that he "knew and approved of the decision to hire Definers and similar firms," but he denied that Facebook asked Definers to spread misinformation. 

Who funded Freedom from Facebook?

Freedom from Facebook's initial donor was David Magerman, a Pennsylvania philanthropist and former hedge fund executive, according to Axios. 

Magerman said he's contributed roughly $425,000 to the campaign so far because he thinks Facebook holds "too much power over how the world communicates."

An official for Soros' nonprofit Open Society Foundations told The Times it's funded some of Freedom from Facebook's member groups but hasn't supported campaigns against Facebook. 

How have Facebook and its executives responded to the criticism?

Zuckerberg and Sandberg both pushed back against criticism over how they handled the scandals. "To suggest we weren't interested in knowing the truth or wanted to hide what we knew or wanted to prevent investigations is simply untrue," Zuckerberg said less than a day after the Times story published.

The two also said they didn't know that Facebook hired Definers or about the firm's work. After the Times report appeared, Facebook ended its contract with Definers. Facebook also plans to look into its relationships with other lobbying firms. Sandberg told CBS that Definers had been hired by "the communications team."

"The article saying that I was spending time hiding, deflecting or hiring PR firms to do other things. That's just all not true," Sandberg told CBS. "I wasn't involved in any of that, and I don't think that was the core strategy at all."

Definers said it wasn't hired by Facebook for opposition research, but that its main work focused on "basic media monitoring and public relations around public policy issues facing the company." The firm acknowledged, though, that it provided "research and background information about critics -- both on the left and the right."

Facebook also denied it knew about Russian activity as early as the spring of 2016, but The New York Times has stood by its reporting. 

Twitter CEO Jack Dorsey And Facebook COO Sheryl Sandberg Testify To Senate Committee On Foreign Influence Operations

Facebook COO Sheryl Sandberg testified before Congress in September. 

Drew Angerer/Getty Images

What impact will this controversy have on Facebook?

The company could face more government regulation. 

Rep. David Cicilline, a Rhode Island Democrat who's expected to become the next chairman of the House Judiciary Committee's antitrust panel, responded to the Times report by saying Facebook can't be trusted to regulate itself. 

When Congress convenes in January, Cicilline wrote on Twitter and Facebook, it should work on legislation to "address the corrupting influence of corporate money in our democracy." 

Meanwhile, Democratic senators are asking the Department of Justice, which is investigating the Cambridge Analytica scandal, to look into whether Facebook "retaliated against critics or public officials seeking to regulate the platform, or hid vital information from the public." 

Facebook is also already grappling with lower employee morale, The Wall Street Journal wrote, and its latest scandal certainly isn't helping. 

Will Zuckerberg or Sandberg step down or get fired?

It appears unlikely. 

Zuckerberg controls 60 percent of Facebook's voting shares, so he can't be forced out of the company. So far, he's signaled that he doesn't have any plans to step down either. 

Facebook's board of directors has defended Facebook's leadership and how the company handled its efforts to combat Russian election interference. There reportedly have been tensions between Zuckerberg and Sandberg. The Facebook CEO told Sandberg that he blamed her and her team for the fallout from the Cambridge Analytica scandal, according to a report by The Wall Street Journal.  

Some Facebook investors have called on Zuckerberg to at least relinquish his title as chairman of the social network's board. But he told CNN on Nov. 20 that he doesn't plan to do so.

He's also showed his support for Sandberg. 

"She has been an important partner for me for 10 years," Zuckerberg told CNN. "I am really proud of the work we have done together and hope we work together for decades more to come."

First published Nov.17, 5 a.m. PT.
Update, Nov. 21 at 12:20 p.m.: Adds Zuckerberg's remarks from an interview with CNN and Elliot Schrage's internal memo about Definers, along with more background about Sandberg.

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