What You Need To Know As Peiter Zatko Prepares To Face Lawmakers Next Month

Topline

Twitter’s former head of cybersecurity Peiter Zatko’s revelations about alleged security vulnerabilities at the platform this week prompted swift action from lawmakers to regulators in Europe—and will see him appear before the Senate Judiciary Committee next month as the social media company pushes back against some of the explosive claims.

Startling new revelations from Twitter’s former head of security, Peiter Zatko, have raised serious … [+] new questions about the security of the platform’s service, its ability to identify and remove fake accounts, and the truthfulness of its statements to users, shareholders and federal regulators.

AP Photo

Key Facts

Zatko’s Senate hearing will take place on September 13 with Judiciary Committee’s chairperson Sen Dick Durbin (D-Ill.) and its top Republican member Sen. Chuck Grassley (R-Iowa) expressing “serious concerns” about “dangerous data privacy and security risks” facing Twitter users.

The senate hearing is scheduled to take place on the day Twitter’s shareholders are set to vote on billionaire Elon Musk’s now stalled plan to acquire the company.

According to the Associated Press, the Securities and Exchange Commission (SEC) is currently questioning Twitter on how it counts fake or bot accounts on its platform, an issue that had emerged as a key sticking point in Musk’s planned buyout of the company.

Sen. Richard Blumenthal (D-Conn.) and Sen. Ed Markey (D-Mass.) have written to the Federal Trade Commission (FTC) urging an investigation into Zatko’s complaints to see if it violates any consumer protection laws or Twitter’s 2011 consent decree with the agency to improve user privacy and security.

Outside the U.S., Zatko’s complaints have prompted the data protection authorities in France and Ireland to investigate if Twitter broke any of the European Union’s stringent rules on the handling of user data and privacy, TechCrunch and Politico reported.

Despite it denying Zatko’s allegations, Twitter has also acted following Zatko’s complaint by merging its content moderation and account reviewing teams, Reuters reported, citing an internal memo.

Key Background

On Tuesday, Zatko accused Twitter of misleading its investors, regulators and users on the state of its platform’s security and intentionally underreporting the number of fake or bot accounts on the platform. His complaint against Twitter was filed with the Department of Justice, the SEC and the FTC. The former company executive alleged Twitter had misled the FTC about its user security and privacy measures—likely in violation of its 2011 deal with the agency. Zatko also alleged that Twitter had given at least one foreign government—the government of India—unfettered access to user data by hiring one of its agents.

Chief Critic

At a company-wide meeting on Wednesday, Twitter dismissed Zatko’s allegations with the company’s CEO Parag Agrawal telling staffers: “This complaint that was filed yesterday is foundationally, technically and historically inaccurate…There are accusations in there without any evidence and many points made without important context,” the New York Times reported. Zatko has claimed he was fired by Agrawal in January after clashing with him over Twitter alleged “whitewash(ing)” of the issues he had raised.

What To Watch For

The effect of Zatko complaints on the upcoming legal battle between Musk and Twitter over the billionaire’s stalled $44 billion acquisition of the social media giant remains unclear. On Wednesday, Twitter’s shares were downgraded by analysts at Rosenblatt Securities citing concerns that the allegations could allow Musk to draw out the legal fight or even walk away from the deal. The Wall Street Journal reported that Musk’s lawsuit against Twitter and Zatko’s allegations have some key differences. While both Musk and Zatko accuse Twitter of effectively fudging its user numbers, they diverge on how the company’s methodology is wrong.

Big Number

5.2%. That is the percentage by which Twitter’s shares have fallen since Zatko’s complaints were made public on Tuesday. When markets closed on Wednesday, Twitter’s shares were trading at $40.79.