FTC Should Investigate Facebook, Leading Senate Democrat Says

(Bloomberg) -- Senate Commerce Chair Maria Cantwell on Thursday asked the Federal Trade Commission to investigate allegations that Facebook, now known as Meta Platforms Inc., misled advertisers and the public about “core aspects” of its business model. 

In a letter to FTC Chair Lina Khan, Cantwell cites whistle-blower documents that cast doubt on Facebook’s claims about how much hate speech is removed by its platforms’ algorithms, raising questions about whether Facebook is misleading advertisers about the safety of its products. The letter also questions whether Facebook inflated the “Potential Reach” of ads -- a key metric for how many people might see them -- suggesting that an ad could reach more young people, for example, than counted by the U.S. Census Bureau. 

“A thorough investigation by the Commission and other enforcement agencies is paramount, not only because Facebook and its executives may have violated federal law, but because members of the public and businesses are entitled to know the facts regarding Facebook’s conduct as they make their decisions about using the platform,” Cantwell said in the letter. 

The allegations from Cantwell, a Washington state Democrat whose committee would consider any new tech regulation, echo the complaints that Facebook whistle-blower Frances Haugen filed with the Securities and Exchange Commission, accusing the social media company of misleading investors with some of the same metrics. 

The FTC, which has both consumer protection and antitrust mandates, has filed a monopoly lawsuit against Facebook alleging that it violated competition laws by buying Instagram and WhatsApp in order to eliminate them as competitors. The FTC is asking the court to unwind those acquisitions. 

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