The Latest: Senators grill Facebook on Libra and trust
WASHINGTON (AP) — The Latest on congressional hearings on the reach of big tech (all times local):
Senators are grilling Facebook on its plans to launch a new digital currency when it’s still battling problems with privacy and other issues.
Arizona Republican Sen. Martha McSally says she doesn’t trust Facebook because of repeated privacy violations and “repeated deceit.”
Facebook executive David Marcus says the company wants to innovate on behalf of its users. He says if another country were to build a successful digital currency first, the system might be out of reach of U.S. regulations and sanctions.
But Hawaii Democratic Sen. Brian Schatz says the question isn’t whether the U.S. should take the lead, but “why Facebook” before it fixes its other problems.
Schatz also questioned whether Facebook has any expertise in money laundering and other financial issues. Marcus responded that Facebook now does because it has hired experts.
Facebook is defending the planned currency, Libra, before a Senate Banking Committee panel Tuesday.
A Facebook executive says digital transactions such as those with the company’s upcoming Libra currency will be better than cash in guarding against criminal activities.
Facebook’s David Marcus was responding to Sen. Catherine Cortez Masto, a Nevada Democrat who asked how the company will guard against money laundering and make sure terrorists don’t use its currency to finance their activity.
Marcus says cash transactions are where most crime currently happens. He says “it will be better” if a lot of transactions move to digital. He says that people who use Libra through Facebook’s upcoming Calibra wallet will have to upload a government ID for verification.
Masto says security pledges are one thing, but she wants to see the specifics.
Marcus is appearing before a Senate Banking Committee panel on Tuesday.
A senior Democratic senator is asserting that “Facebook is dangerous” as a Senate panel opens a hearing on Facebook’s plan for a new currency.
Sen. Sherrod Brown of Ohio, the senior Democrat on the Senate Banking Committee, sought assurances from Facebook executive David Marcus that the plan wouldn’t jeopardize the privacy of its billions of users’ data.
Marcus assured that Facebook “will take the time to get this right” and welcomes an extensive review by federal regulators.
Brown pressed Marcus on whether he and his team would accept their salary in the new currency, Libra. Marcus says that Libra is not meant to compete with bank accounts but finally says yes, “I would trust all my assets in Libra.”
U.S. senators from both parties are opening a hearing with tough questions and criticisms of Facebook’s ambitious plan to create a financial eco-system based on a digital currency.
Ohio Sen. Sherrod Brown, the Senate Banking Committee’s ranking Democrat, says it’s hard to trust Facebook after a series of privacy scandals. He says it “takes a breathtaking amount of arrogance” to think it can run its own bank.
Committee Chairman Mike Crapo, an Idaho Republican, is questioning why Facebook wants to base the project in Switzerland.
David Marcus, the Facebook executive leading the project, says it’s not an attempt to avoid oversight but that Switzerland is a recognized international finance center. Marcus says if the U.S. fails to act, then digital currencies could be controlled by others with dramatically different values.
Google is reiterating it does not work with the Chinese military after President Donald Trump said on Twitter he would “take a look” at Google and its relationship to Chinese intelligence.
“As we have said before, we do not work with the Chinese military,” said Google Spokeswoman Riva Sciuto in an emailed response for comment. “We are working with the U.S. government, including the Department of Defense, in many areas including cybersecurity, recruiting and healthcare.”
The comments come as a House Judiciary subcommittee is holding a bipartisan investigation of the market power of Facebook, Google, Amazon and Apple.
President Donald Trump is vowing to “take a look” at Google after a billionaire investor suggested it may have been infiltrated by Chinese intelligence
Before 5 a.m. Eastern, Trump in a tweet called Peter Thiel, “A great and brilliant guy who knows this subject better than anyone! The Trump Administration will take a look!”
A House Judiciary subcommittee is holding a bipartisan investigation of the market power of Facebook, Google, Amazon and Apple. Congress begins two days of hearings Tuesday on the currency planned by Facebook, to be called Libra, starting with the Senate Banking Committee.
Over the weekend, Thiel said the FBI and the CIA should open an investigation into Google.
According to the Axios story, Theil said Google was “engaged in the seemingly treasonous decision to work with the Chinese military and not with the US military.”
Facebook’s ambitious plan to create a financial eco-system based on a digital currency faces questions from lawmakers. It’s already being shadowed by negative comments from President Donald Trump, his treasury secretary and the head of the Federal Reserve.
Congress begins two days of hearings Tuesday on the currency planned by Facebook, to be called Libra, starting with the Senate Banking Committee. Meanwhile, a House Judiciary subcommittee will be extending its bipartisan investigation of the market power of Facebook, Google, Amazon and Apple.
Trump tweeted last week that Libra “will have little standing or dependability.”
The Democratic head of the House Financial Services Committee, which is holding a hearing on Wednesday, has called on Facebook to suspend the plan until Congress and regulators can review it.