Silicon Valley Tech News Roundup – November 5th
Sam Bankman-Fried found guilty, faces a maximum sentence of 115 years in prison – 11/3
Sam Bankman-Fried has been found guilty of seven criminal counts against him. The jury convicted him of conspiracy to commit securities and commodities fraud, wire fraud, and conspiracy to commit wire fraud against Alameda Research lenders and FTX customers, and conspiracy to commit money laundering. The jury deliberated for five hours before reaching a verdict.
Damian Williams (U.S. attorney, Southern District of New York) stated after the verdict: “Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history… While the cryptocurrency industry might be new and the players like Sam Bankman-Fried might be new, this kind of corruption is as old as time. This case has always been about lying, cheating, and stealing, and we have no patience for it.”
Merrick Garland (Attorney General) stated: “This case should send a clear message to anyone who tries to hide their crimes behind a shiny new thing they claim no one else is smart enough to understand: the Justice Department will hold you accountable.”
Sam Bankman-Fried faces a potential maximum sentence of 115 in prison. The court scheduled the sentencing for March 28, 2024.
Amazon antitrust lawsuit reveals company’s secret price-gauging algorithm – 11/3
A newly unsealed document in Amazon’s antitrust lawsuit revealed the company used an anticompetitive algorithm. The lawsuit referenced it as “Project Nessie”. It was a pricing tool Amazon used to raise the prices of products and force its rivals to do the same. By utilizing this tool, Amazon earned more than $1 billion over two years. The prosecutors filed the unsealed portions of the lawsuit in Seattle federal court on Thursday.
The filing revealed third-party sellers made up over 80% of the Amazon catalog of over a billion products in 2020. More than 70% of Amazon shoppers do not go past the first page of search results. Likewise, customers make over 98% of purchases through “Buy Box,” which contains “Add to cart” and “Buy now” buttons. The revelations highlighted how important it is for sellers to have a good relationship with Amazon and how powerful the user interface is.
The lawsuit also revealed Amazon executives used the encrypted messaging app Signal and its disappearing messages function to hide their communication from regulators for the past two years.
The FTC alleges Amazon monitored sellers and punished them if they offered lower prices on other platforms. Likewise, the company increased the use of ads in search results. Jeff Bezos insisted on the new ad policies (even though sponsored ads were often irrelevant to the search) as a way to increase the company’s profit margins.
Tim Doyle (Amazon’s spokesperson) stated: “Amazon works incredibly hard every day to earn customers trust, and customer feedback on our shopping experience is consistently positive… Amazon works hard to make it fast and easy for customers to find the items they want and discover similar options by providing a mix of organic and sponsored search results based on factors including relevance, reviews, availability, price, and speed of delivery, along with helpful search filters to refine their results.”
Former Facebook employee to testify in Congress over safety issues at Instagram – 11/3
According to a report by the Wall Street Journal, another former Facebook employee and Instagram consultant will testify in front of Congress on Nov. 7th about Instagram’s safety issues.
Arturo Bejar worked at Facebook between 2009 and 2015. In 2019, he advised Instagram’s well-being team. Bejar alleges the company failed to act on its research that young users were having harmful experiences on the social media platform. According to the report, Bejar tried to raise an alarm within the company about safety issues. The research showed that 20% of users younger than 16 “felt worse about themselves after viewing others’ posts.” Furthermore, 13% of users “experienced unwanted sexual advances in the past seven days.”
The revelations come a week after 41 state attorney generals sued Meta for “harmful and psychologically manipulative product features” that had a negative impact on the mental health of its young users.
Marsha Blackburn and Richard Blumenthal, senators who sit on the Senate Judiciary Committee, stated: “From Arturo’s disclosures, we now know that Mark Zuckerberg, Adam Mosseri, and other Meta executives were personally warned that millions of teens face bullying, eating disorder material, illicit drugs, and sexual exploitation, often within minutes of opening the app… Rather than address these deadly harms, Facebook continued to hide this information from the public and Congressional oversight, ignored recommendations to protect teens, rolled back safety tools, and dismantled teams responsible for kids’ safety.”
X is trying to sell disused user handles for $50,000 – 11/4
A report published by Forbes reveals X (former Twitter) is trying to find buyers for disused user handles the company reclaimed from inactive accounts.
X created a task force called “@Handle team,” whose job is to create a marketplace for handles reclaimed from inactive accounts. According to Forbes, the team has been sending solicitation emails that ask for “a flat fee of $50,000 to initiate a purchase.”
Earlier in the year, X changed its policy, and now requires users to log in every 30 days for their accounts to remain active. If they fail to do so, they risk having their accounts removed or permanently suspended. However, the company’s website still states it cannot release inactive usernames.