Dems pan ‘Zuck buck,’ want Facebook to rein in currency plan

Associated Press

WASHINGTON

Facebook endured a second day of criticism from Congress over its plan to create a digital currency as senior House Democrats asked Facebook to scale back the project and threatened legislation that would block big tech companies from getting into banking.

Facebook’s massive market power and its record of scandals, fines and privacy breaches were on trial at a hearing Wednesday of the House Financial Services Committee. Lawmakers from both parties insisted they cannot trust the social network giant.

“I think you’re pretty low on the trust spectrum right now, and understandably,” Rep. Vicente Gonzalez, D-Texas, told David Marcus, the Facebook executive leading the project.

Among their concerns is the risk that the new currency, to be called Libra, could be used for illicit activity such as money laundering or drug trafficking.

Lawmakers also worry that the massive reserve created with money used to buy Libra could supplant the Federal Reserve and destabilize the financial system, and that consumers could be hurt by Libra losses.

The committee’s leader, Rep. Maxine Waters, D-Calif., has asked Facebook to suspend its plan for the new currency until regulators and lawmakers have a chance to fully review it. She renewed that demand to Marcus.