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Lawmakers Grill Facebook CEO On Massive Data Scandal. Aired 3:30-4p ET

Aired April 10, 2018 - 15:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[15:30:00] MARK ZUCKERBERG, FACEBOOK CEO: Yes, Senator. So, data privacy and foreign interference in elections are certainly topics that we have discussed at the board meeting. These are some of the biggest issues that the company has faced, and we feel a huge responsibility to get these right.

SEN. MARIA CANTWELL (D), WASHINGTON: Do you believe the European regulations should be applied here in the U.S.?

ZUCKERBERG: Senator, I think everyone in the world deserves good privacy protection. And, regardless of whether we implement the exact same regulation, I would guess that it would be somewhat different, because we have somewhat different sensibilities in the U.S. as to other countries.

We're committed to rolling out the controls and the affirmative consent and the special controls around sensitive types of technology, like face recognition, that are required in GDPR. We're doing that around the world.

So, I think it's certainly worth discussing whether we should have something similar in the U.S. But what I would like to say today is that we're going to go forward and implement that, regardless of what the regulatory outcome is.

GRASSLEY: Senator Wicker?

Senator Thune will chair next.

JACK TAPPER, CNN HOST: We're going to take a quick break. You're watching CEO of Facebook, Mark Zuckerberg, testify before the Senate. Back in two minutes. Stay with us.

(COMMERCIAL BREAK)

TAPPER: Welcome back to CNN's coverage of Facebook's CEO Mark Zuckerberg testifying before the Senate. Let's rejoin Mr. Zuckerberg and the Senators.

SEN. ROGER WICKER (R), MISSISSIPPI: ...We'll have to follow up on this. But I think you and I agree, this is going to be one of the major items of debate if we have to go forward and do this from a governmental standpoint.

Let me just move on to another couple of items. [15:35:00] Is it true that -- as was recently publicized, that

Facebook collects the call and text histories of its users that use Android phones?

ZUCKERBERG: Senator, we have an app called Messenger for sending messages to your Facebook friends. And that app offers people an option to sync their text messages into the messaging app, and to make it so that -- so basically so you can have one app where it has both your texts and your Facebook messages in one place.

We also allow people the option of...

WICKER: You can opt in or out of that?

ZUCKERBERG: Yes. It is opt-in.

WICKER: It is easy to opt out?

ZUCKERBERG: It is opt-in. You have to affirmatively say that you want to sync that information before we get access to it.

WICKER: Unless you opt in, you don't collect that call and text history?

ZUCKERBERG: That is correct.

WICKER: And is that true for -- is this practice done at all with minors, or do you make an exception there for persons aged 13 to 17?

ZUCKERBERG: I do not know. We can follow up with that.

WICKER: OK, let's do that. One other thing, there have been reports that Facebook can track a user's internet browsing activity, even after that user has logged off of the Facebook platform. Can you confirm whether or not this is true?

ZUCKERBERG: Senator, I want to make sure I get this accurate, so it would probably be better to have my team follow up afterwards.

WICKER: You don't know?

ZUCKERBERG: I know that the people use cookies on the internet, and that you can probably correlate activity between -- between sessions. We do that for a number of reasons, including security, and including measuring ads to make sure that the ad experiences are the most effective, which, of course, people can opt out of. But I want to make sure that I'm precise in my answer, so let me --

WICKER: When -- well, when you get, sir.

ZUCKERBERG: ... follow up with you on that.

WICKER: -- would you also let us know how Facebook discloses to its users that engaging in this type of tracking gives us that result?

ZUCKERBERG: Yes. WICKER: And thank you very much.

SEN. CHUCK GRASSLEY (R), IOWA: Thank you, Senator Wicker.

Senator Leahy's up next.

SEN. PATRICK LEAHY (D), VERMONT: Thank you.

Mr. Zuckerberg, I assume Facebook's been served with subpoenas from the Special Counsel Mueller's office. Is that correct?

ZUCKERBERG: Yes.

LEAHY: Have you or anyone at Facebook been interviewed by the Special Counsel's Office?

ZUCKERBERG: Yes.

LEAHY: Have you been interviewed...

ZUCKERBERG: I have not. I have not.

LEAHY: Others have?

ZUCKERBERG: I believe so. And I want to be careful here, because that -- our work with the special counsel is confidential, and I want to make sure that, in an open session, I'm not revealing something that's confidential.

LEAHY: I understand. I just want to make clear that you have been contacted, you have had subpoenas.

ZUCKERBERG: Actually, let me clarify that. I actually am not aware of a subpoena. I believe that there may be, but I know we're working with them.

LEAHY: Thank you.

Six months ago, your general counsel promised us that you were taking steps to prevent Facebook preserving, what I would call an unwitting co-conspirator in Russian interference. But these unverified, divisive pages are on Facebook today. They look a lot like the anonymous groups that Russian agents used to spread propaganda during the 2016 election. Are you able to confirm whether they're Russian- created groups? Yes or no?

ZUCKERBERG: Senator, are you asking about those specifically?

LEAHY: Yes.

ZUCKERBERG: Senator, last week, we actually announced a major change to our ads and pages policies. That we will be identifying the identity of every single advertiser...

LEAHY: I'm asking about specific ones. Do you know whether they are?

ZUCKERBERG: I am not familiar with those pieces of content specifically.

LEAHY: But, if you decided this policy over a week ago, you'd be able to verify them?

ZUCKERBERG: We are working on that now. What we're doing is we're going to verify the identity of any advertiser who's running a political or issue-related ad. This is basically what the Honest Ads Act is proposing, and we're following that. And we're also going to do that for pages. So --

LEAHY: But you can't answer on these?

ZUCKERBERG: I'm not familiar with those specific cases.

LEAHY: Well, will you -- will you find out the answer and get back to me?

ZUCKERBERG: I'll have my team get back to you.

I do think it's worth adding, though, that we're going to do the same verification of the identity and location of admins who are running large pages.

[15:40:00] So, that way, even if they aren't going to be buying ads in our system, that will make it significantly harder for Russian interference efforts or other inauthentic efforts --

LEAHY: Some will --

ZUCKERBERG: -- to try to spread misinformation through the network.

LEAHY: It's a fight that's been going on for some time, so I might say it's about time.

You know, six months ago, I asked your general counsel about Facebook's role as a breeding ground for hate speech against Rohingya refugees. Recently, U.N. investigators blamed Facebook for playing a role in inciting possible genocide in Myanmar. And there has been genocide there. You say you use A.I. to find this. This is the type of content I'm referring to. It calls for the death of a Muslim journalist. Now, that threat went straight through your detection systems, it spread very quickly, and then it took attempt after attempt after attempt, and the involvement of civil society groups, to get you to remove it.

Why couldn't it be removed within 24 hours?

ZUCKERBERG: Senator, what's happening in Myanmar is a terrible tragedy, and we need to do more.

LEAHY: We all agree with that.

ZUCKERBERG: OK.

LEAHY: But U.N. investigators have blamed you -- blamed Facebook for playing a role in that genocide. We all agree it's terrible. How can you dedicate, and will you dedicate, resources to make sure such hate speech is taken down within 24 hours?

ZUCKERBERG: Yes. We're working on this. And there are three specific things that we're doing. One is we're hiring dozens of more Burmese-language content reviewers, because hate speech is very language-specific. It's hard to do it without people who speak the local language, and we need to ramp up our effort there dramatically.

Second is we're working with civil society in Myanmar to identify specific hate figures, so we can take down their accounts, rather than specific pieces of content.

And third is we're standing up a product team to do specific product changes in Myanmar and other countries that may have similar issues in the future to prevent this from happening.

LEAHY: Senator Cruz and I sent a letter to Apple, asking what they're going to do about Chinese censorship. My question, I'll place it.

THUNE: That'd be great. Thank you, Senator Leahy.

LEAHY: I'll place for the record -- I want to know what you will do about Chinese censorship, when they come to you.

JOHN THUNE (R) SOUTH DAKOTA: Senator Graham's up next.

SEN. LINDSEY GRAHAM (R) SOUTH CAROLINA: Thank you. Are you familiar with Andrew Bosworth?

ZUCKERBERG: Yes, Senator, I am.

GRAHAM: He said, So, we connect more people. Maybe someone dies in a terrorist attack coordinated on our tools. The ugly truth is that we believe in connecting people so deeply that anything that allows us to connect more people, more often, is de facto good.

Do you agree with that?

ZUCKERBERG: No, Senator, I do not. And, as context, Boz wrote that -- Boz is what we call him internally -- he wrote that as an internal note. We have a lot of discussion internally. I disagreed with it at the time that he wrote it. If you looked at the comments on the internal discussion --

GRAHAM: Would you say --

ZUCKERBERG: -- the vast majority of people internally did, too.

GRAHAM: -- that you did a poor job, as a CEO, communicating your displeasure with such thoughts? Because, if he had understood where you -- where you were at, he would have never said it to begin with.

ZUCKERBERG: Well, Senator, we try to run our company in a way where people can express different opinions internally.

GRAHAM: Well, this is an opinion that really disturbs me. And, if somebody worked for me that said this, I'd fire them. Who's your biggest competitor?

ZUCKERBERG: Senator, we have a lot of competitors.

GRAHAM: Who's your biggest?

ZUCKERBERG: I think the categories of -- did you want just one? I'm not sure I can give one, but can I give a bunch?

GRAHAM: Yes.

ZUCKERBERG: So, there are three categories that I would focus on. One, are the other tech platforms -- so Google, Apple, Amazon, Microsoft -- we overlap with them in different ways.

GRAHAM: Do they do -- do they provide the same service you provide?

ZUCKERBERG: In different ways -- different parts of it, yes.

GRAHAM: Let me put it this way. If I buy a Ford, and it doesn't work well, and I don't like it, I can buy a Chevy. If I'm upset with Facebook, what's the equivalent product that I can go sign up for?

ZUCKERBERG: Well, there -- the second category that I was going to talk about are --

GRAHAM: I'm not talking about categories. I'm talking about, is there real competition you face? Because car companies face a lot of competition. If they make a defective car, it gets out in the world, people stop buying that car, they buy another one.

Is there an alternative to Facebook in the private sector?

[15:45:00] ZUCKERBERG: Yes, Senator. The average American uses eight different apps to communicate with their friends and stay in touch with people.

GRAHAM: OK. Which is --

ZUCKERBERG: Ranging from texting apps, to e-mail, to --

GRAHAM: Which is the same service you provide?

ZUCKERBERG: Well, we provide a number of different services.

GRAHAM: Is Twitter the same as what you do?

ZUCKERBERG: It overlaps with a portion of what we do.

GRAHAM: You don't think you have a monopoly?

ZUCKERBERG: It certainly doesn't feel like that to me.

GRAHAM: OK. So, it doesn't. So, Instagram -- you bought Instagram. Why did you buy Instagram?

ZUCKERBERG: Because they were very talented app developers who were making good use of our platform and understood our values.

GRAHAM: It is a good business decision. My point is that one way to regulate a company is through competition, through government regulation. Here's the question that all of us got to answer, what do we tell our constituents, given what's happened here, why we should let you self-regulate? What would you tell people in South Carolina, that given all of the things we've just discovered here, it's a good idea for us to rely upon you to regulate your own business practices?

ZUCKERBERG: Well, Senator, my position is not that there should be no regulation.

GRAHAM: OK.

ZUCKERBERG: I think the internet is increasingly --

GRAHAM: You embrace regulation?

ZUCKERBERG: I think the real question, as the internet becomes more important in people's lives, is what is the right regulation, not whether there should be or not.

GRAHAM: But -- but you, as a company, welcome regulation?

ZUCKERBERG: I think, if it's the right regulation, then yes.

GRAHAM: You think the Europeans had it right?

ZUCKERBERG: I think that they get things right.

GRAHAM: Have you ever submitted. That's true. So, would you work with us in terms of what regulations you think are necessary in your industry?

ZUCKERBERG: Absolutely.

GRAHAM: OK. Would you submit to us some proposed regulations?

ZUCKERBERG: Yes. And I'll have my team follow up with you so, that way, we can have this discussion across the different categories where I think that this discussion needs to happen.

GRAHAM: Look forward to it. When you sign up for Facebook, you sign up for a terms of service. Are you familiar with that?

ZUCKERBERG: Yes.

GRAHAM: OK. It says, "The terms govern your use of Facebook and the products, features, apps, services, technologies, software we offer -- Facebook's products or products -- except where we expressly state that separate terms, and not these, apply."

I'm a lawyer. I have no idea what that means. But, when you look at terms of service, this is what you get. Do you think the average consumer understands what they're signing up for?

ZUCKERBERG: I don't think that the average person likely reads that whole document.

GRAHAM: Yes.

ZUCKERBERG: But I think that there are different ways that we can communicate that and have a responsibility to do so.

GRAHAM: Do you -- do you agree with me that you better come up with different ways, because this ain't working?

ZUCKERBERG: Well, Senator, I think, in certain areas, that is true. And I think, in other areas, like the core part of what we do -- right, if you -- if you think about -- just, at the most basic level, people come to Facebook, Instagram, WhatsApp, Messenger, about a hundred billion times a day to share a piece of content or a message with a specific set of people.

And I think that that basic functionality people understand, because we have the controls in line every time, and given the volume of -- of -- of the activity, and the value that people tell us that they're getting from that, I think that that control in line does seem to be working fairly well.

Now we can always do better, and there are other -- the services are complex, and there is more to it than just -- you know, you go and you post a photo, so I -- I -- I agree that -- that in many places we could do better.

But I think for the core of the service, it actually is quite clear.

GRASSLEY: Thank you, Senator Graham. Senator Klobuchar.

SEN. AMY KLOBUCHAR (D), MINNESOTA: Thank you, Mr. Chairman. Mr. Zuckerberg, I think we all agree that what happened here was bad. You acknowledged it was a breach of trust. And the way I explain it to my constituents is that if someone breaks into my apartment with the crowbar and they take my stuff, it's just like if the manager gave them the keys or if they didn't have any locks on the doors, it's still a breach; it's still a break in. And I believe we need to have laws and rules that are sophisticated as the -- the brilliant products that you've developed here. And we just haven't done that yet.

And one of the areas that I've focused on is the election. And I appreciate the support that you and Facebook, and now Twitter, actually, have given to the Honest Ads Act bill that you mentioned, that I'm leading with Senator McCain and Senator Warner.

And I just want to be clear, as we work to pass this law so that we have the same rules in place to disclose political ads and issue ads as we do for TV and radio, as well as disclaimers, that you're going to take early action, as soon as June I heard, before this election so that people can view these ads, including issue ads. Is that correct?

ZUCKERBERG: That is correct, senator. And I just want to take a moment before I go into this in more detail to thank you for your leadership on this. This, I think, is an important area for the whole industry to move on. The two specific things that we're doing are -- one is around transparency, so now you're going to be able to go and click on any advertiser or any page on Facebook and see all of the ads that they're running. So that actually brings advertising online -- on Facebook to an even higher standard than what you would have on TV or print media, because there's nowhere where you can see all of the TV ads that someone is running, for example. Whereas you will be able to see now on Facebook whether this campaign or third party is saying different messages to different types of people, and I think that that's a really important element of transparency.

But the other really important piece is around verifying every single advertiser who's going to be running political or issue ads.

KLOBUCHAR: I appreciate that. And Senator Warner and I have also called on Google and the other platforms to do the same. So, memo to the rest of you, we have to get this done or we're going to have a patchwork of ads, and I hope that you'll be working with us to pass this bill. Is that right?

ZUCKERBERG: We will.

KLOBUCHAR: OK, thank you.

Now on the subject of Cambridge Analytica, were these people, the 87 million people, users, concentrated in certain states? Are you able to figure out where they're from?

ZUCKERBERG: I do not have that information with me, but we can follow up with your -- your office.

KLOBUCHAR: OK, because as we know, that election was close, and it was only thousands of votes in certain states. You've also estimated that roughly 126 people -- million people may have been shown content from a Facebook page associated with the Internet Research Agency.

Have you determined when -- whether any of those people were the same Facebook users who's data was shared with Cambridge Analytica? Are you able to make that determination?

ZUCKERBERG: Senator, we're investigating that now. We believe that it is entirely possible that there will be a connection there.

KLOBUCHAR: OK, that seems like a big deal as we look back at that last election. Former Cambridge Analytica employee Christopher Wiley has said that the data that it improperly obtained -- that Cambridge Analytica improperly obtained from Facebook users could be stored in Russia.

Do you agree that that's a possibility?

ZUCKERBERG: Sorry, are you -- are you asking if Cambridge Analytica's data -- data could be stored in Russia?

KLOBUCHAR: That's what he said this weekend on a Sunday show.

ZUCKERBERG: Senator, I don't have any specific knowledge that would suggest that.

But one of the steps that we need to take now is go do a full audit of all of Cambridge Analytica's systems to understand what they're doing, whether they still have any data, to make sure that they remove all the data. If they don't, we're going to take legal action against them to do so.

That audit, we have temporarily ceded that in order to let the U.K. government complete their government investigation first, because, of course, a government investigation takes precedence against a company doing that. But we are committed to completing this full audit and getting to the bottom of what's going on here, so that way we can have more answers to this.

KLOBUCHAR: OK.

You earlier stated publicly and here that you would support some privacy rules so that everyone's playing by the same rules here. And you also said here that you should have notified customers earlier.

Would you support a rule that would require you to notify your users of a breach within 72 hours?

ZUCKERBERG: Senator, that makes sense to me. And I think we should have our team follow up with -- with yours to -- to discuss the details around that more.

KLOBUCHAR: Thank you.

I just think part of this was when people don't even know that their data's been breached, that's a huge problem. And I also think we get to solutions faster when we get that information out there.

Thank you. And we look forward to passing this bill -- we'd love to pass it before the election -- on the honest ads. And I'm looking forward to better disclosure this election.

Thank you.

THUNE: Thank you, Senator Klobuchar.

[15:50:00] Senator Blunt's up next.

TAPPER: Senator Amy Klobuchar questions of Mark Zuckerberg during the joint hearing between the Senate Judiciary and Commerce Committee with the Facebook CEO talking about the data breach and election interference in 2016. Let's talk about it now briefly with the Dana Bash and Dylan Byers. Dylan as quickly as you can, how do you think he's doing?

DYLAN BYERS, CNN SENIOR REPORTER: I think he's doing great. I think he's winning. And winning for three reasons. He's winning, number one, he's clearly done a lot of testing and prep for this and he's very cool under pressure. Two, the questions from the senators are all over the map. And are we talking about data privacy or talking about Russian meddling in the election, are we talking about political ads and regulation on political ads. It is all over the place.

And third, and this is far and away the most important issue, we don't have tech literate senators. There is a clear disconnect here between the priorities of the tech community and even the sort of knowledge of the senators about what these issues are. The -- first of all, the big issue is data privacy. That is the big issue. And secondly the question is not can users trust Facebook. No, you can't trust Facebook because these problems are inherent to the platform. The question is should users have a right to own their data and do they need clearer transparency and choice about how the information is shared.

[15:55:00] TAPPER: And I would say that Cantwell and Klobuchar seem to be fairly eloquent and knowledgeable.

BYERS: That is right --

TAPPER: And let's talk about that for a second. Because I don't want to be age-ist here but I keep have these memories of me trying to teach my grandmother how to use a mouse.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: And when your 2-year- old knows how to use it --

TAPPER: It is obvious that some of the senators have never been on Facebook.

BASH: Absolutely. We know for a fact that some of the senators don't text or use the internet. It is just not their thing. And they do have staff that does but it is one thing for staff to prepare them and another thing to understand how this works. And that speaks to what Dylan was talking about. The questions are all over the place but it is in part because there is so much to ask about.

This is such a wide frontier which has been the wild west and the open question at the end of the hearing is going to be is Congress going to figure out a way to try to regulate or not. And if the answer is not, is Facebook going to feel enough sort of pressure on its stock and on its bottom line to do it in a more robust way on their own. And this is new. The fact that we're just now -- since Facebook was --

TAPPER: 2007.

BASH: Since 2007 now seeing the head of Facebook on Capitol Hill for the first time tells you how much a gulf there has been through the very important industry and people who make laws.

TAPPER: We'll take a break. And special coverage continues on "The Lead" in just a moment. Stay with us.