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SEC asking if Facebook properly warned investors of data issue -- WSJ

The agency is looking into how much Facebook knew about Cambridge Analytica's misuse of data, says a report in The Wall Street Journal.

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abrar-al-heeti2
Abrar Al-Heeti Video producer / CNET
Abrar Al-Heeti is a video host and producer for CNET, with an interest in internet trends, entertainment, pop culture and digital accessibility. Before joining the video team, she was a writer for CNET's culture team. She graduated with bachelor's and master's degrees in journalism from the University of Illinois at Urbana-Champaign. Though Illinois is home, she now loves San Francisco -- steep inclines and all.
Expertise Abrar has spent her career at CNET breaking down the latest trends on TikTok, Twitter and Instagram, while also reporting on diversity and inclusion initiatives in Hollywood and Silicon Valley. Credentials
  • Named a Tech Media Trailblazer by the Consumer Technology Association in 2019, a winner of SPJ NorCal's Excellence in Journalism Awards in 2022 and has twice been a finalist in the LA Press Club's National Arts & Entertainment Journalism Awards.
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The Securities and Exchange Commission is looking into whether Facebook gave investors enough warning about the possible misuse and improper gathering of users' data, The Wall Street Journal reported Thursday. 

In March, news surfaced that information on 87 million Facebook users was allegedly misused by data analysis firm Cambridge Analytica , a consultant for the Trump campaign during the 2016 US presidential election. Earlier this month, several federal agencies, including the SEC, the Federal Trade Commission and the FBI joined the Department of Justice's inquiry into the data scandal. 

The SEC has requested information from Facebook to learn how much the social-networking company knew about Cambridge Analytica's data use, according to the Journal. In addition, the SEC reportedly wants to learn how Facebook analyzed its risk as developers shared data with others in violation of Facebook's policies. 

The SEC and Facebook declined to comment. A Facebook representative did point to a previous statement by the company: "We are cooperating with officials in the US, UK and beyond. We've provided public testimony, answered questions and pledged to continue our assistance as their work continues."

The SEC is also looking into whether the company should've told shareholders about Cambridge Analytica's policy violation when Facebook found out about it, in 2015.