US senators press Facebook on 'trust' in hearing on digital currency

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US senators press Facebook on 'trust' in hearing on digital currency

Tuesday, July 16, 2019

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WASHINGTON,United States(AFP) — US senators Tuesday questioned whetherFacebookcan be trusted with a massive financial responsibility at the first public hearing on its plan for a global digital currency called Libra.

The lawmakers added to criticism of the plan unveiled byFacebooklast month with two dozen partners on the digital coin, touted as a way to lower costs and facilitate cross-border money transfers.

David Marcus,Facebook's executive heading the digital coin effort, defended the plan during more than two hours at a Senate Banking Committee hearing on Libra, pledging to comply with all regulations to thwart money laundering and criminal activity.

Yet several senators warned of the risks of the plan and questioned whetherFacebookcan be trusted after a wave of missteps on privacy and data protection.

"Facebookmight not intend to be dangerous but surely they don't respect the power of the technologies they are playing with," said Senator Sherrod Brown, an Ohio Democrat.

"Over and over,Facebookhas said just trust us, and every time Americans trust you, they seem to get burned."

Republican Senator John Kennedy of Louisiana peppered Marcus with a series of questions about whatFacebookexecutives knew about Russian manipulation of social media ahead of the 2016 US election to cast doubt onFacebook's trustworthiness.

"I have great respect forFacebookbutFacebooknow wants to control the money supply. What could possibly go wrong?" the senator said.

Marcus, whose written comments to the panel were released Monday, noted thatFacebookwas working with regulators worldwide and reiterated that the new system is designed to meet needs of people who may be outside the traditional banking system.

"Libra is intended to address an important problem," Marcus said.

"Imagine a daughter who wants to send money home to her mom in another country. Of the $200 she sends, $14 on average will be lost because of fees. It can also take several days or even a week for the mother to receive the money, a delay that can prove disastrous in an emergency."

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