Two Senators Warn Mastercard, Stripe, & Visa On Associating With Facebook’s Libra After PayPal Exit
Facebook's Libra stable coin's problems are mounting by the day, PayPal one of the key members of the Libra Association has already withdrawn from the project amid growing pressure and questions being raised about the legitimacy and privacy concerns associated with the project.
Now Senator Sherrod Brown from Ohio and Senator Brian Schatz from Hawaii have urged there more associate members of Libra Association to reconsider their decision, reported Bloomberg. In a letter written to three payment processing companies Stripe, MasterCard and Visa, the Senators have tried to address the various issues that the Libra project. The letter noted that Libra not only poses a risk to the global financial network but could turn into an Achilles heel for various private payment processing giants as well.
The letter also mentions several news reports on how difficult it has become for the Libra Association members to obtain details about the organization's management roadmap as well as various risks involved.
Both the Senators in a statement said that,
Congress, financial regulators, and potential Libra Association member companies have struggled to get sufficient details from Facebook about risks that Libra may pose, including facilitating criminal and terrorist financing, destabilizing the global financial system, interfering with monetary policy, or exposing consumers to risks currently limited to accredited investors.”
They added further,
“We urge you to carefully consider how your companies will manage these risks before proceeding, given that Facebook has not yet demonstrated to Congress, financial regulators — and perhaps not even to your companies — that it is taking these risks seriously,”
they said in the letter.
Facebook's Libra has too many Concerns on its Hands
Right from its announcement, regulators and policymakers around the globe have been raising alarm bells about the complexities and issues associated with Facebook's past record and the working structure of Libra.
The Senators pointed out Facebook's inability to curb wrong use of customer's private data which include grave offenses such as privacy rights violation, failing to curb spreading of disinformation, accusations of election interference and fraud.
Brown and Schatz, both the senators warned the associate members saying,
“You should be concerned that any weaknesses in Facebook’s risk management systems will become weaknesses in your systems that you may not be able to effectively mitigate.”