Oct. 23 (UPI) — Facebook CEO Mark Zuckerberg appeared in Congress Wednesday to testify about the social media platform’s plans for its Libra cryptocurrency and other issues, including ongoing concerns about user privacy.
The hearing, titled “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors,” began at 10 a.m. EDT in the House financial services committee. The hearing centers mainly on Facebook’s plan next year to launch the Libra and digital wallet Calibra — the latter of which will be available on the Facebook app and its Messenger and Whatsapp platforms.
The committee was expected to ask Zuckerberg about concerns from U.S. regulators, including Federal Reserve Board Jerome Powell, who have said the Libra could present issues related to “privacy, money laundering, consumer protection and financial stability.”
Powell said the project “cannot go forward” without addressing those concerns, while regulators in France and Germany blocked the Libra from their markets.
The committee notes that seven of the corporate partners who initially supported the Libra have since dropped out — PayPal, Visa, Mastercard, Stripe, eBay, Marcado Pago and Booking.
Financial services committee Chairwoman Maxine Waters and other Democrats on the panel sent a letter to Zuckerberg and Facebook in July calling for the company to halt its plans for the Libra.
“Because Facebook is already in the hands of over a quarter of the world’s population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these issues and take action,” they wrote.
The Senate banking committee questioned David Marcus, head of the Facebook subsidiary in charge of Libra, in July. He said Libra will allow users to send money around the world for free with the same ease as sending a text message or a photo.
The cryptocurrency is planned to be headquartered in Switzerland, despite the fact it will be regulated by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network and backed on a one-to-one basis through cash bank deposits, short term government securities and hard currencies — including the U.S. dollar, British pound, euro and Japanese yen.
In his July testimony, Marcus said the entire Libra system will be fully vetted before launch.
Also at Wednesday’s hearing, lawmakers will also question the billionaire chief executive about other concerns, including litigation involving purported Facebook violations of the Fair Housing Act, how the company plans to protect users’ financial and personal information and the company’s handling of diversity and inclusion among employees.