For Immediate Release: January 31, 2012
Washington, DC – As Facebook prepares to launch the process for establishing its much-anticipated initial public offering (IPO) this week, Human Rights First is urging the company to make clear how it will address lingering human rights concerns to potential investors. The group is also calling on Congress to close a major loophole that permits insider trading by members of Congress – a topic that will come to the forefront as Facebook’s IPO launches.
Among the human rights concerns potential investors should consider are unanswered questions about how Facebook will approach user privacy in countries where the internet is a tool of repression rather than expression. According to Human Rights First, Facebook should explain how it would respond to government requests for user information or for censorship.
“Facebook is the industry leader in social networking. Their privacy and human rights policies will become the standard for all services. Likewise, their failure to adequately anticipate and address human rights concerns will have grave consequences,” said Human Rights First’s Meg Roggensack. “Facebook has a responsibility to future investors to answer these questions before they launch their IPO this spring.
The Federal Trade Commission (FTC) recently reached a settlement that requires Facebook to revise its privacy policies and subject them to periodic independent review. The settlement agreement – which explicitly covers user generated registration and data posts – doesn’t clearly indicate how Facebook would handle information gathered about its users while on the site.
With regard to insider trading concerns, a recent 60 Minutes investigation revealed that there is currently nothing illegal about members of Congress using the information they obtain in the course of their lawmaking duties – including information not otherwise publicly available – to buy and sell stock. Yesterday, the U.S. Senate voted 93-2 to proceed with consideration of the Stop Trading on Congressional Knowledge (STOCK) Act, legislation that would ensure that insider trading laws apply to lawmakers. A vote on final passage is expected to occur later this week. The House is working on similar legislation that members will consider later this month.
“With Facebook’s IPO just around the corner, this bill and the new spirit of disclosure it represents – is timely. Only a select few will have an opportunity to purchase Facebook stock and realize the outsize profits that this superheated offering is expected to garner. It’s worth asking whether members of Congress are among this group. Facebook has a number of key issues pending before various committees and it’s important for Congress to maintain its integrity and independence,” Roggensack concluded.