Current:Home > MyElon Musk wants to get out of buying Twitter. A whistleblower's claims might help him -MoneyStream
Elon Musk wants to get out of buying Twitter. A whistleblower's claims might help him
View
Date:2025-04-17 13:47:47
Billionaire Elon Musk's chances of walking away unscathed from his commitment to buy Twitter just improved, thanks to recent allegations from the company's former security chief.
Twitter looks like a cybersecurity dumpster fire in a whistleblower complaint submitted to federal regulators by Peiter Zatko. He complains of lax security practices that put users' personal data at risk and the social media company in danger of violating a settlement agreement with federal regulators. He also alleges that the Indian government forced Twitter to hire two government agents who had access to sensitive data.
Soon after Zatko's concerns became public, Musk referenced them in new legal claims. The Tesla CEO now argues that Twitter is damaged goods and by hiding such egregious problems, it committed fraud.
Twitter calls Zatko's complaints inaccurate, inconsistent and opportunistic.
Twitter sued Musk in July after he tried to break off the agreement to buy the company for $44 billion. Musk claimed that the company had understated the prevalence of bots–or spam accounts–on its platform and that was justification for his change of heart.
Given that Musk had waived due diligence when he signed the agreement–not to mention that it was he, and not the company, who had sought the acquisition–many experts believed he had a flimsy legal case.
His legal claims "just always seemed like such an incredibly long shot argument to begin with," said Ann Lipton, a business and securities law professor at Tulane University. "The other allegations – hair-raising data-security and intellectual-property problems – those at least have a lot more potential."
The trial is scheduled to begin October 17 in Delaware. Musk has asked the judge for a delay so that his legal team could gather more information about what went on inside Twitter.
Twitter has claimed that any delay hurts its business and shareholders.
Why Musk has a better chance to walk away from the deal
Zatko, who also goes by his hacker handle "Mudge," worked as Twitter's head of security from 2020 until January. During that time, he says, company leaders –including CEO Parag Agrawal – ignored his warnings about serious security flaws. In a whistleblower complaint filed with the Securities and Exchange Commission, the Federal Trade Commission and the Department of Justice, Zatko alleges that executives ignored these problems.
Twitter said Zatko's complaint is a "false narrative" and inaccurate, and that he was fired for poor performance.
The company is under an FTC consent agreement, signed in 2011 after hackers repeatedly seized control and tweeted from a handful of users' accounts. At the time, the agency said Twitter "failed to take reasonable steps" to safeguard its system. The agreement requires the company to maintain a comprehensive security system and be truthful with users about the extent to which it protects their personal information.
After Zatko's allegations became public, Musk filed a new letter to terminate the contract to buy Twitter. His lawyers argue that, if the allegations are true, the FTC could fine Twitter millions of dollars for violating the consent agreement.
"Twitter has already paid a fine of $150 million for violating an aspect of that decree, and Facebook recently paid $5 billion for similar user data violations," the letter notes.
That risk, previously hidden, gives Musk the right to walk away, it says.
Whistleblower complaint also has the attention of Congress
Zatko is scheduled to be deposed by Musk's lawyers on Sept. 9. The following week, he's slotted to testify before the Senate Judiciary Committee.
If Zatko's claims are accurate, "they may show dangerous data privacy and security risks for Twitter users around the world," the top lawmakers on the committee, Democrat Dick Durbin of Illinois and and Republican Chuck Grassley of Iowa, said in a statement, pledging the committee would "get to the bottom of these alarming allegations."
Senators have also asked the FTC to investigate Twitter. The agency has declined to comment.
veryGood! (656)
Related
- Federal appeals court upholds $14.25 million fine against Exxon for pollution in Texas
- These major cities have experienced the highest temperature increases in recent years
- How Vanderpump Rules' Tom Sandoval Wanted to Craft the Perfect Breakup Before Cheating Scandal
- US shoots down Turkish drone after it came too close to US troops in Syria
- Man can't find second winning lottery ticket, sues over $394 million jackpot, lawsuit says
- Nonprofit service provider Blackbaud settles data breach case for $49.5M with states
- Roy Wood Jr. exits 'The Daily Show' amid Comedy Central permanent host search
- Why Suki Waterhouse Took a Bout of Celibacy Before Dating Robert Pattinson
- What do we know about the mysterious drones reported flying over New Jersey?
- A homeless man is charged with capital murder and rape in the death of a 5-year-old Kansas girl
Ranking
- Pressure on a veteran and senator shows what’s next for those who oppose Trump
- Pepco to pay $57 million over toxic pollution of Anacostia River in D.C.'s largest-ever environmental settlement
- Millions of children are displaced due to extreme weather events. Climate change will make it worse
- Horoscopes Today, October 5, 2023
- House passes bill to add 66 new federal judgeships, but prospects murky after Biden veto threat
- Army identifies soldiers killed when their transport vehicle flipped on way to Alaska training site
- NFL releases adaptive and assisted apparel, first pro sports league to do so
- New Mexico signs final order to renew permit at US nuclear waste repository
Recommendation
Trump wants to turn the clock on daylight saving time
$228M awarded to some plaintiffs who sued Nevada-based bottled water company after liver illnesses
Josh Duhamel says Hollywood lifestyle played a role in his split with ex-wife Fergie
Federal judges select new congressional districts in Alabama to boost Black voting power
The Best Stocking Stuffers Under $25
Men took over a job fair intended for women and nonbinary tech workers
Jury hears testimony in trial of officers charged in Manuel Ellis' death
Jury hears testimony in trial of officers charged in Manuel Ellis' death
Like
- Realtor group picks top 10 housing hot spots for 2025: Did your city make the list?
- South African flag may be taken down at rugby & cricket World Cups for doping body’s non-compliance
- Dramatic video shows plane moments before it crashed into Oregon home, killing 22-year-old instructor and 20-year-old student pilot