Facebook faced mounting pressure on Friday after a new whistleblower accused it of knowingly hosting hate speech and illegal activity, even as leaked documents shed further light on how the company failed to heed internal concerns over election misinformation.
Allegations by the new whistleblower, who spoke to the Washington Post, were reportedly contained in a complaint to the Securities and Exchange Commission, the US agency that handles regulation to protect investors in publicly traded companies.
In the complaint, the former employee detailed how Facebook officials frequently declined to enforce safety rules for fear of angering Donald Trump and his allies or offsetting the company’s huge growth. In one alleged incident, Tucker Bounds, a Facebook communications official, dismissed concerns about the platform’s role in 2016 election manipulation.
“It will be a flash in the pan,” Bounds said, according to the affidavit, as reported by the Post. “Some legislators will get pissy. And then in a few weeks they will move on to something else. Meanwhile, we are printing money in the basement, and we are fine.”
The claims echo those of the whistleblower Frances Haugen, a former Facebook product manager who has said the company repeatedly prioritizes profit over public safety. Haugen’s recent damning testimony before the US Congress, and forthcoming testimony before the UK parliament, has prompted a major PR crisis for the social network, which is said to be readying plans for a rebrand.
The whistleblower claims came on the same day that news outlets, including the New York Times, the Washington Post and NBC, published reports based on internal documents shared by Haugen. The documents offer a deeper look into the spread of misinformation and conspiracy theories on the platform, particularly related to the 2020 US presidential election.
The documents show that Facebook employees repeatedly flagged concerns before and after the election, when Donald Trump tried to falsely overturn Joe Biden’s victory. According to the New York Times, a company data scientist told coworkers a week after the election that 10% of all US views of political content were of posts that falsely claimed the vote was fraudulent. But as workers flagged these issues and urged the company to act, the company failed or struggled to address the problems, the Times reported.
The internal documents also show Facebook researchers have found the platform’s recommendation tools repeatedly pushed users to extremist groups, prompting internal warnings that some managers and executives ignored, NBC News reported.
In one striking internal study, a Facebook researcher created a fake profile for “Carol Smith”, conservative female user whose interests included Fox News and Donald Trump. The experiment showed that within two days, Facebook’s algorithm was recommending “Carol” join groups dedicated to QAnon, a baseless internet conspiracy theory.
Facebook watchdogs say the latest whistleblower accounts of wrongdoing underscore the need to regulate the platform.
“It’s time for Congress and the Biden administration to investigate a Facebook business model that profits from spreading the most extreme hate and disinformation,” said Jessica J González, co-CEO of the civil rights organization Free Press Action. “It’s time for immediate action to hold the company accountable for the many harms it’s inflicted on our democracy.”
Responding to the Post about the whistleblower’s claims, Bounds said: “Being asked about a purported one-on-one conversation four years ago with a faceless person, with no other sourcing than the empty accusation itself, is a first for me.”
Erin McPike, a Facebook spokeswoman, also criticized the Post’s reporting, saying in a statement to the news organization that it set “a dangerous precedent to hang an entire story on a single source making a wide range of claims without any apparent corroboration”.
“This is beneath the Washington Post, which during the last five years would only report stories after deep reporting with corroborating sources,” she told the Guardian in a statement.
But the reports align with what others have shared about the company. Haugen in her testimony stated that Facebook at one point tweaked its algorithm to improve safety and decrease inflammatory content but abandoned the changes after the election, a decision that Haugen tied directly to the 6 January riot at the Capitol. Facebook also disbanded the civic integrity team after the election.
“As soon as the election was over, they turned them back off or they changed the settings back to what they were before, to prioritize growth over safety. And that really feels like a betrayal of democracy to me,” she said in her testimony on 5 October.
Referring to the algorithm change, Haugen added: “Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site, they’ll click on less ads, and [Facebook] will make less money.”
Haugen’s own SEC filings alleged that Facebook leadership avoided reporting such issues in SEC filings available to investors. The SEC is tasked with scrutinizing whether public firms should disclose such information to investors.
Rocket Lab has taken delivery of NASA’s CAPSTONE spacecraft at its New Zealand launch pad ahead of a mission to the Moon.
It’s been quite a journey for CAPSTONE [Cislunar Autonomous Positioning System Technology Operations and Navigation Experiment], which was originally supposed to launch from Rocket Lab’s US launchpad at Wallops Island in Virginia.
The pad, Launch Complex 2, has been completed for a while now. However, delays in certifying Rocket Lab’s Autonomous Flight Termination System (AFTS) pushed the move to Launch Complex 1 in Mahia, New Zealand.
The wet dress rehearsal for the launch was completed last night, prompting CEO Peter Beck to say: “Next stop…the Moon!”
“I always wanted to say that,” he added. Beck has long dreamed of sending his rockets beyond Low Earth Orbit (LEO) and is planning a mission to Venus in 2023. However, the Moon is than the company has sent its rockets to date.
CAPSTONE is to be sent to a Near Rectilinear Halo Orbit (NRHO) around the Moon, a location planned for the NASA, ESA, and CSA Gateway. CAPSTONE’s primary mission is to verify simulations that the interaction gravity of the Earth and Moon will make for a stable orbit.
The milestone was hit as Rocket Lab announced its first quarter 2022 results. Overall, the company made a net loss of $26.7 million, down from the $15.9 million loss of the same period last year, but revenues jumped to $40.7 million from $18.2 million. Most interesting was the make-up of that revenue. Space Systems (the company’s Photon spacecraft and the components it sells) accounted for a whopping 84 percent of Q1 revenue. Actual Electron rockets fared less well; during a call with analysts, CFO Adam Spice said that launches contributed just $6.6 million.
Going forward, the company expects second quarter revenues to be between $51 million and $54 million. It is including three dedicated launches in that figure (of which CAPSTONE is one). Two have already happened, and there is potential for a fourth, but the company has opted to take a prudent path and not include it in the figures.
As for CAPSTONE, it will be integrated with the Electron rocket and Photon spacecraft bus ahead of the launch window opening on May 31. The Electron will launch the spacecraft into LEO and the Photon will take care of the ballistic lunar transfer via multiple orbit raisings. A final burn of Photon’s engine will occur on the sixth day, enough to escape Earth orbit and send CAPSTONE on a course for the Moon. ®
A DCU Alpha spin-out, UrbanVolt says it sells power generated from solar energy at up to 30pc lower rates than traditional suppliers.
UrbanVolt, a Dublin-based clean energy company, has secured €36m in financing to expand its solar panel business in Ireland and the UK.
The funding includes a €30m asset-backed seven-year loan from Swedish credit fund PCP and €6m from existing funding partners, BVP and Beach Point Capital.
Founded in 2015 by Kevin Maughan, Graham Deane and Declan Barrett, UrbanVolt finances and installs solar panels on the rooftops of commercial and industrial businesses, selling the solar electricity generated to the businesses at up to 30pc lower rate than traditional suppliers.
The company said it also guarantees the price for up to 30 years, protecting businesses against rising energy costs for decades to come, with no minimum amount payable or standing charges – meaning that customers pay proportionate to their consumption.
“This is a transformational deal, which will allow us to scale at pace to meet the significant demand in the market while also streamlining the process of installing solar panels for our customers’ benefit,” said Maughan, who is also the CEO of the DCU Alpha spin-out.
“This first funding facility from PCP will see our project output grow by 20x over the coming years. It is also happening at a time when the demand for renewable energy is rising significantly given climate and geopolitical crises.”
The loan facility will be used to fund the installation of solar panels and related equipment on UrbanVolt’s primary target of commercial and industrial client sites in both Ireland and the UK.
It started supplying solar-generated electricity directly to businesses in Ireland last summer, since when it has agreed contracts with more than 60 companies and completed seven installations.
Maughan sad that there is “simply no compelling reason” for commercial and industrial operators to opt for traditional energy sources anymore, adding that UrbanVolt offers “unparalleled” price security and clean energy.
“By incorporating an ‘as a service’ business model, our customers only pay for the energy they use without a standing charge, and the cost of our equipment and its maintenance is kept off their balance sheet.”
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Digital investors have withdrawn savings in the “stablecoin” tether worth $7.6bn (£6.2bn) since the cryptocurrency crisis began last week, suggesting the company has paid out a sum almost twice its total cash holdings to spooked depositors.
Stablecoins are supposed to have a fixed value matched to a real-world asset, in most cases $1 a token. However, faith in the concept was rocked last Tuesday when another big player, terra, broke its peg to the dollar. That has fuelled a wider sell-off across the crypto sector, which relies on stablecoins for much of its financial engineering.
Tether, the third biggest cryptocurrency by “market cap”, experienced a short-lived crisis on Thursday when its value dropped from $1 to 95¢ as savers feared it would follow its fellow stablecoin terra and collapse. However, the token, which is controlled by a private company with close links to the crypto exchange Bitfinex, has since largely restored its dollar peg by honouring a promise to allow savers to always withdraw $1 for every tether they give back to the company.
The company only allows direct withdrawals of at least $100,000 for each request, and charges a fee of 0.1% on redemptions. Anyone with less tether than that minimum can only turn their money into dollars by finding someone to buy it from them – a disparity that fuelled the temporary collapse in value.
Despite the difficulties, according to public blockchain data, $7.6bn of tether has been reallocated in this way since Thursday. That is almost twice the cash that Tether had in its reserves at the end of last year, according to accounts published on its website.
Most of the rest of its reserves are held in “cash-like” assets, the majority of which are $35bn of US government debt and $25bn of corporate bonds. However, the company has refused to share any further details of the investments, with its chief technology officer, Paolo Ardoino, telling the Financial Times: “We don’t want to give our secret sauce.”
There have long been fears as to Tether’s ability to honour all redemptions. The company had once said it backed its currency with “US dollars”, a claim the New York attorney general said in 2021 “was a lie”. Now, it simply claims its currency is “backed 100% by Tether’s reserves”.
By contrast, terra was backed by a complex algorithm that required the value of a sister cryptocurrency, luna, to constantly rise in order to maintain the dollar peg. When the crash hit last week, the system went into a “death spiral”, automatically printing more luna, which crashed the price further, until luna lost 99.9995% of its value in a matter of days and terra was left languishing at $0.11.
The charismatic founder of the Terra project, Do Kwon, has said he wants to relaunch the currency. In a proposal posted to the project’s message board on Friday, he suggested wiping all ownership of luna, and redistributing 1bn new tokens, with most going to those who hold the stablecoin, or who held luna before last week’s crash.
“It is a hard balance – and no easy answers in redistributing value within the network,” Kwon wrote. “But value must be distributed to allow the ecosystem to survive, and in its current state it will not.”
Kwon also faces questions about how the vast sums of bitcoin that his project had amassed to back terra were spent. According to a breakdown shared by the organisation, it sold more than 80,000 bitcoins, worth more than $2.4bn, to unnamed parties in exchange for terra valued at $1 – at a time when the public price of the currency was under 75¢.
The jitters around stablecoins have combined with a general slump in tech stocks and the wider US downturn to trigger a wider crisis of confidence across the crypto sector. Bitcoin and ethereum, the two biggest cryptocurrencies, are down more than 10% over the last seven days, with ethereum dropping 17% to less than $2,000. Smaller currencies have, as always, been more volatile, with dogecoin falling 26% over the week.
Even some of the most vocal backers of digital currencies are now querying the promises of the sector. The founder of the crypto exchange FTX, Sam Bankman-Fried, said in an interview with the Financial Times that bitcoin has no future as a payments network because of the inherent inefficiencies of its blockchain, the public digital register that records its transactions. Instead, he argued, it could only function as a gold-like store of long-term value.