Hillicon Valley — Presented by NCTA — HUD hits Facebook with discrimination charges | Agency also investigating Twitter, Google | Twitter may label Trump tweets that violate rules | Apple moves raise competition concerns

by Harper Neidig, Olivia Beavers, Jacqueline Thomsen and Emily Birnbaum - 03/28/19 6:02 PM ET

Welcome to Hillicon Valley, The Hill’s newsletter detailing all you need to know about the tech and cyber news from Capitol Hill to Silicon Valley. If you don’t already, be sure to sign up for our newsletter with this LINK.

Welcome! Follow the cyber team, Olivia Beavers (@olivia_beavers) and Jacqueline Thomsen (@jacq_thomsen), and the tech team, Harper Neidig (@hneidig) and Emily Birnbaum (@birnbaum_e).

ANOTHER PROBLEM FOR FACEBOOK: The Department of Housing and Urban Development (HUD) on Thursday charged Facebook with encouraging and enabling housing discrimination through its targeted advertising practices.

HUD is charging Facebook with violating the Fair Housing Act, federal legislation that prohibits discrimination against people seeking to buy or rent a home.

“Facebook is discriminating against people based upon who they are and where they live,” HUD Secretary Ben Carson said in a statement. “Using a computer to limit a person’s housing choices can be just as discriminatory as slamming a door in someone’s face.”

The charge follows a months-long investigation by HUD into whether Facebook illegally allows real estate sellers to restrict their advertisements by characteristics such as race.

Facebook earlier this month agreed to enact sweeping reforms to its ad-targeting system as part of a settlement with civil rights groups alleging similar complaints. The rights groups, including one dedicated to housing, alleged the tech giant allowed advertisers to discriminate against marginalized groups.

As part of that settlement, Facebook will no longer allow advertisers to target or exclude housing ads by age, gender or zip code, and it also removed hundreds of targeting options for anyone advertising housing, credit or employment opportunities.

The company as part of the settlement also said it will create a new portal to allow users to search for and view housing ads in the U.S. regardless of who the advertisers hoped to target.

Facebook’s response: Facebook said it was surprised by HUD’s decision, and said it had enacted changes to its platform to undercut misuse by advertisers. The company also said it had tried to work with HUD.

“While we were eager to find a solution, HUD insisted on access to sensitive information — like user data — without adequate safeguards,” the spokesperson added. “We’re disappointed by today’s developments, but we’ll continue working with civil rights experts on these issues.”

Read more here.

ARE TWITTER AND GOOGLE NEXT?: The Department of Housing and Urban Development (HUD) is also investigating Twitter and Google for allegedly enabling discriminatory ad practices, according to The Washington Post.

A source familiar with the agency’s actions told the Post that HUD informed the companies of the investigation last year and that the probes are ongoing.

“They want to make sure that other companies aren’t getting away with something that one company is investigated for,” a source familiar with the probes told the Post.

The revelation comes hours after HUD charged Facebook with encouraging and enabling housing discrimination through its targeted advertising practices.

More here on Google and Twitter.

TRICKY TRUMP TWEETS: A Twitter executive on Wednesday said the company is considering a new feature that will label tweets from politicians, including President Trump, when they violate Twitter rules.

Vijaya Gadde, Twitter’s head of legal, policy, and trust and safety, at a Washington Post event on Wednesday said the company might start annotating offensive tweets from public figures with a message about why they remain up.

Twitter has long held that some posts from public figures should remain up because they are “newsworthy,” even when they violate the company’s guidelines.

“One of the things we’re working really closely on with our product and engineering folks is, ‘How can we label that?'” Gadde said during the Post event. “How can we put some context around it so people are aware that that content is actually a violation of our rules and it is serving a particular purpose in remaining on the platform?”

Gadde was responding to a question about whether Trump is allowed to say whatever he wants on Twitter.

“When we leave that content on the platform there’s no context around that and it just lives on Twitter and people can see it and they just assume that is the type of content or behavior that’s allowed by our rules,” Gadde said.

Twitter’s policies dictate that tweets from politicians are important to public debate.

Trump has used his Twitter account to insult and berate his foes, including news organizations, Democrats, actors and more, raising questions from critics about why Twitter does not step in.

Read more here.

TOO BIG TO FAIL?: Apple’s new entertainment subscription services and credit card, launched to great fanfare this week, could raise new concerns for the company over market power and competition issues.

Apple executives at a star-studded event in Cupertino, Calif., this week unveiled subscription services in gaming, news and television, as well as a new Apple credit card.

Apple has managed to avoid much of the scrutiny over tech company power and antitrust enforcement that have hit other giants like Amazon, Facebook and Google. But the company’s latest moves into entertainment services is raising red flags for antitrust experts.

“I would caution that enforcers need to be very vigilant to make sure that Apple is not tipping the scales in its favor,” Sally Hubbard, director of enforcement strategy at the Open Markets Institute, told The Hill.

Hubbard said she is concerned that Apple is “controlling the game and playing the game too” as the owner of both the iOS App Store and creator of the iPhone.

The big picture: The new concerns over Apple are emerging as lawmakers show more interest in reining in big tech, particularly when it comes privacy and competition issues.

Sen. Elizabeth Warren (D-Mass.), a 2020 contender, earlier this month released a plan to break up some of Silicon Valley’s largest tech companies: Facebook, Google and Amazon. She later told media outlets that she would target Apple as well.

“Apple, you’ve got to break it apart from their App Store,” Warren said. “It’s got to be one or the other. Either they run the platform or they play in the store. They don’t get to do both at the same time. So it’s the same notion.”

Read more here.

LEFT BEHIND: The Human Rights Campaign, an LGBTQ rights group, has pulled Google from its Corporate Equality Index (CEI) after the technology giant did not pull an app that promotes conversion therapy from its app store.

The Human Rights Campaign said in the footnotes to this year’s CEI ratings that it pulled Google after becoming aware of the app for Living Hope Ministries, a group that says it advocates for “committed, monogamous, heterosexual” relationships and says “anything less than this ideal falls short of God’s view for humanity.”

In the footnotes of the CEI, the Human Rights Campaign criticized Living Hope Ministries’s promotion of “conversion therapy,” a discredited practice that seeks to change a person’s sexual orientation.

“Such practices have been rejected by every mainstream medical and mental health organization for decades. Minors are especially vulnerable, and conversion therapy can lead to depression, anxiety, drug use, homelessness, and suicide,” the Human Rights Campaign noted.

“Pending remedial steps by the company to address this app that can cause harm to the LGBTQ community, the CEI rating is suspended.”

Google declined to comment to The Hill.

Read more here.

HUA-WHOOPS: British cybersecurity officials said Thursday they discovered major technical issues in Chinese telecom supplier Huawei’s software, posing risks to the United Kingdom’s mobile networks, according to The Associated Press.

Inspectors said they can give only “limited assurance” that British cybersecurity measures can manage long-term national security risks from Huawei’s involvement in the country’s telecom networks, the AP reported.

Officials noted in their annual report on Huawei’s security that the company has not taken any action to address the security flaws identified in last year’s report.

Read more here.

GOOGLE’S CHINA PROBLEM ISN’T GOING AWAY: A Republican lawmaker is demanding answers about Google’s work in China after the company’s CEO met with President Trump and Pentagon officials to assuage the administration’s concerns that its efforts are benefiting Beijing.

Sen. Josh Hawley (R-Mo.) sent a letter to Google CEO Sundar Pichai on Thursday expressing concern about the internet giant’s Chinese operations after military leaders told Congress that Google’s work is effectively aiding China’s government.

“It is worth asking what Google stands to gain from partnering with a country that routinely violates basic human liberties, including maintaining detention facilities for nearly a million Uyghur Muslims, banning freedom of speech and the press, and repressing its Christian, Tibetan Buddhist and other religious communities,” Hawley wrote.

“Is the technology Google develops, ostensibly for the welfare of consumers, being used by the Chinese government to further perpetuate these human rights violations?”

Google did not immediately respond when asked for comment on the letter.

Trump revealed on Twitter Wednesday that he had met with Pichai, who he said told him that Google is “totally committed to the U.S. Military, not the Chinese Military.” The president also said they discussed “political fairness.”

Read more here.

CYBER ON CYBER ON CYBER: A bipartisan group of lawmakers introduced legislation Thursday to create an advisory committee of cyber professionals to help the Department of Homeland Security (DHS) take on cyber issues.

The bill, introduced by Reps. John Katko (R-N.Y.), Dan Lipinski (D-Ill.), Dan Newhouse (R-Wash.) and Brian Fitzpatrick (R-Pa.), would create an advisory committee within DHS’s Cybersecurity and Infrastructure Security Agency (CISA) to offer recommendations on new cybersecurity policies and programs.

The committee would consist of 35 cybersecurity professionals from state and local governments, as well as industries like health care, energy, transportation and manufacturing.

A maximum of three members from each industry would be allowed on the committee, and members would serve terms of two years.

Katko, the ranking member of the Cybersecurity, Infrastructure Protection and Innovation subcommittee on the House Homeland Security Committee, said the bill “takes steps towards equipping the agencies within the Department of Homeland Security with the necessary tools to respond to evolving cyber threats.”

“By creating a Cybersecurity Advisory Committee, we can facilitate a vital dialogue between public and private partners and better secure the U.S.,” he said in a statement.

Read more here.