Data privacy alarm bells sound in wake of Facebook/Cambridge Analytica scandal

Tech giants such as Google are facing calls for tighter data rules in the wake of the Facebook election scandal. (Reuters)
Updated 23 March 2018

Data privacy alarm bells sound in wake of Facebook/Cambridge Analytica scandal

SAN FRANCISCO: Big Internet companies and small software developers alike are likely to face scrutiny over how they share customer information in the wake of the scandal involving Facebook and the British election consulting firm Cambridge Analytica.
Lawmakers in the US and the EU have called for probes into how Facebook allowed Cambridge Analytica to access data on 50 million users and use it to help the election campaign of President Donald Trump. Facebook shares have fallen 8.5 percent this week as investors fear the incident will lead to new regulation.
The scrutiny and the risk of regulatory action could affect Alphabet Inc’s Google, Twitter Inc, Uber Technologies Inc, Microsoft Corp’s LinkedIn and the many others that make their user data available to outside developers.
The interconnections between platforms such as Facebook and Google and third-party services sit at the core of the contemporary Internet, enabling people to share articles to Facebook from news websites and log into shopping apps using their Google account.
But the Facebook case has turned the application programming interfaces, or APIs, that enable such data sharing, into a new front in the escalating battle between lawmakers and tech companies over the monitoring and securing of their vast platforms. Threat of sanctions has already prodded companies into better policing of inappropriate commentary on their services.
“All companies are going to need to do a lot more than just laissez faire policy to manage third-party data access,” said Jason Costa, who helped run APIs at Pinterest Inc, Twitter and Google and now works at GGV Capital. “The days of (the) ‘we’re just a platform and can’t be held responsible for how users use it’ line that many companies use, is no longer going to be tenable.”
APIs have raised privacy concerns since they emerged around 2005, but their adoption and impact has grown rapidly as companies move data online and look for ways to make it more useful.
Uber, for example, in 2016 enabled apps that provided tax and lending services to import driver paystubs. The company failed to respond to a request for comment on its monitoring and auditing practices.
The economic dynamic behind APIs is simple: Software developers create new tools that benefit big tech companies’ users, and in return they gain instant access to a large number of consumers.
The big platforms say they have built in protection, such as human reviews and automated scanning tools to detect abuse by partners.
But software experts say policies are toothless because auditing is lax; Facebook CEO Mark Zuckerberg, under intense public pressure, said on Wednesday the company would now perform audits of the information it shared with partners before it tightened rules in 2014.
Dartmouth University engineering professor Geoffrey Parker, who has assigned students to develop apps based on APIs, said automated policing methods will detect spam-like apps and brazen efforts to steal data. It is much more difficult to enforce bans on storing or mashing together information, or acting against users’ interest, he said.
Some companies added safeguards in the past several years. Facebook stopped allowing developers access to information on its users’ friends. But compliance audits were minimal, a former employee said on the condition of anonymity.
Twitter and LinkedIn limited free public access. For paid deals, LinkedIn said “partners are rigorously vetted and regularly declined.” The company added that it regularly monitors API usage and takes “swift action when we see or hear of any abuse of our terms.”
Software developers acknowledged they often do not even read the terms of use for APIs. Rule-breakers can fly under the radar and amass significant information, said Andres Blank, chief executive of recruiting software maker Scout.
“It is hard to police if the alarms aren’t being sounded,” said Blank, who has worked with APIs from LinkedIn and Google. Alex Moore, chief executive of Baydin Inc, which develops Boomerang, an app that can send emails on time-delay, said Microsoft scrutinized his services when the companies partnered on a new feature. But he was not aware of any auditing after it launched. Google recently asked whether Boomerang could access less information, but that was a rare “poke,” Moore said. 
“There is going to be things people took for granted about data sharing that come to light,” he warned. Google declined to comment. Microsoft did not respond to a request to comment.
Clamping down could limit the supply of innovative tools built on data sharing. But some providers, including Royal Bank of Canada, which announced an API this week, have gone a step further to allow access only to vetted partners. 
Paul Nerger, senior vice president at, which helps companies such as Cisco Systems Inc. manage APIs, said clients have limited the number of partners so that software can be tested “to make sure they are not illegally harvesting” data. 
Startups are taking heed, too. Affectiva, which last year released an API for identifying consumers’ emotional states from speech samples, said that it would audit partners as its program grows. However, Gabi Zijderveld, the company’s chief marketing officer and head of product strategy, said: “We inevitably need regulation and legislation on ethical and transparent use of data.”

Saudi Real Estate Refinance Co. plans up to $1.07bn sukuk sale this year

Updated 27 min 17 sec ago

Saudi Real Estate Refinance Co. plans up to $1.07bn sukuk sale this year

  • The plan by SRC, a subsidiary of Saudi Arabia’s sovereign Public Investment Fund, comes as it prepares to purchase more home loan portfolios
  • SRC, formed in 2017, is also keen to tap foreign institutional investors for its debt sale this year

RIYADH: Saudi Real Estate Refinance Co. (SRC), modelled on US mortgage finance firm Fannie Mae, aims to issue up to 4 billion riyals ($1.07 billion) of long-term sukuk this year, its chief executive said on Tuesday.

The plan by SRC, a subsidiary of Saudi Arabia’s sovereign Public Investment Fund, comes as it prepares to purchase more home loan portfolios from mortgage financing companies and banks to boost the Kingdom’s secondary mortgage market.

SRC, formed in 2017, is also keen to tap foreign institutional investors for its debt sale this year, Fabrice Susini told Reuters in an interview.

“Our strategy is clearly to tap the market twice this year,” he said. “We are really looking at probably issuing something between ... 2 and 4 billion riyal that we may be issuing in two tranches.

He said SRC was looking at sukuk in the 10 to 15-year range, to help minimize refinancing risks. “Generally speaking we are trying to issue as long as possible,” Susini said.

He said the company was assessing whether it could also issue bonds in currencies other than the local riyal.

In March, SRC completed a 750 million riyal sukuk issue with multiple tenors, under a program that allows it to issue up to 11 billion riyals of local currency denominated Islamic bonds.

“The rule of the game for us is, like many projects across the Kingdom, attract liquidity from foreign investors,” Susini said.

He said SRC had spent 1.2 billion riyals from its balance sheet buying mortgages from local mortgage financing companies and provided liquidity to these firms.

It has also signed initial accords with several commercial banks to acquire housing mortgage portfolios.

Saudi Arabia’s housing ministry is targeting the mortgage market to reach a total value of 502 billion riyals by 2020 from around 300 billion riyals now.

The government wants to increase activity in the real estate market as it moves to revitalize the economy and is taking steps to reform the sector as part of its 2030 reform plan.

It has been working with developers and local banks to counter a shortage of affordable housing — one of the country’s biggest social and economic problems. Saudi Arabia wants 60 percent of its nationals to own homes by 2020, up from 47 percent in 2016.

The size of real estate financing relative to its gross domestic product is 5 percent in Saudi Arabia compared to 69 percent in the United States, 74 percent in the United Kingdom and 43 pct in Canada, the housing ministry has said.

“The goal of SRC in this market was to make sure that we will be able to refinance at least around 10 percent of the market in 2020, and 20 percent of the market by 2028,” Susini told Reuters.