Kid-porn scandal: Is Facebook still good investment?

By Chelsea Schilling

(This is Part 3 of a multi-part series on child pornography on Facebook. You can read Part 1 here, Part 2 here and Part 4 here. Media wishing to interview WND’s Chelsea Schilling, please contact us here.)

(EXPLICIT CONTENT: This report contains graphic details of sexual abuse of children as it has appeared in numerous locations on Facebook. WND immediately reported images of child pornography and child sexual abuse to the FBI. Censored screenshots published are among the mildest of those found.)

The group is called “I.ncest Forever” – and people from around the world share their sexual fantasies and real-life sexual exploits with their own mothers, fathers, siblings and children.

A boy no older than 4 is positioned between the legs of another toddler lying on a plaid blanket. He pins the second child down in a sexual position, and they are both naked. The photo is taken from above the children – likely by an adult – and posted to the immensely popular group.

Read Chelsea Schilling’s personal account of her heart-wrenching and hard-hitting investigation into child pornography on Facebook.

The face of another boy, between 10 and 12, is planted in a bed. He’s wearing sneakers and grabbing his ankles as a man twice his size holds his waist and sodomizes him. Shortly after its posting, at least 34 people had “liked” the photo.

These are just two examples of many gruesome child pornography images on Facebook, the popular social network now making an initial public offering that may value the company as high as $100 billion.

On this site of 901 million users, many of the world’s pedophiles seek validation and acceptance. They rape small children, upload images of their abuse and trade those photos like currency with thousands of insatiable predators on Facebook.

As part of an undercover news investigation, WND used alias Facebook profiles and located dozens of child-porn images after “friending” many likely pedophiles and predators who trade thousands of pornographic photos on the social network. WND immediately reported graphic images of children and sex abuse to the FBI. (You can read more about that investigation in Part 1 and Part 2 of this series.)

Despite repeated requests over the course of almost two months, Facebook did not respond to phone calls and emails. However, after Part 1 of this series was published, the social network provided a brief, emailed statement that WND posted here.

The following short documentary was posted on YouTube exposing the issue of child pornography on Facebook. While it covers the period from November 2010 to January 2011, it pinpoints many of the tactics still in use today by pedophiles and child-pornography traders on the social network.

(Warning: Contains disturbing screenshots of “likes,” interests and foul language posted by pedophiles):

Most-anticipated tech stock debut

While this scenario is unfolding on its pages, Facebook is set to raise as much as $13.6 billion in an initial public offering that could value the social network at nearly $100 billion – about four times the value of Google at the time it went public in 2004. It’s the most-anticipated tech stock debut in a decade. Facebook is now pitching its shares to investors in a “roadshow” in New York, Boston and Palo Alto, Calif.

According to Facebook’s filing with the U.S. Securities and Exchange Commission, investment bank Morgan Stanley is acting as lead underwriter, with Goldman Sachs, Bank of America and others taking secondary positions. Shares are expected to hit the market as early as this month.

The filing states that the company founded by Mark Zuckerberg in 2004 now has 901 million registered users and 3,539 employees. Facebook earned $1 billion on sales of $3.7 billion in 2011.

Initial public offerings, or IPOs, can offer large returns, great liquidity and positive publicity for a company. Meanwhile, investors are wondering whether Facebook will be overvalued, how much shares will cost and details about risk.

Investors want to know: Should they buy stock in Facebook?

Raymond Bechard, author of “The Berlin Turnpike: A True Story of Human Trafficking in America,” the first anti-human trafficking political action committee in the U.S. Bechard’s co-combatant in this battle against child pornography is Richard Lepoutre, who has been actively involved in the fight to protect children from sexual abuse for more than 25 years. The two are co-founders of the Stop Child Porn on Facebook campaign.

Bechard told WND: “I would advise my financial advisers and anyone I’ve invested with to do what Goldman Sachs did when they realized they owned part of Village Voice and, therefore, Backpage.com [a website that faced accusations it had been a platform to traffic underage girls and boys for sex]. That is, just immediately sell it.”

He said, in that case, some people argued that Goldman Sachs should have kept its stake in Village Voice and Backpage.com and tried to force them to fix the problem.

“But they just washed their hands of it and said they weren’t going to have any part of it because it’s commercial sexual exploitation,” he explained. “God forbid somebody gets killed or a young person gets sold into sexual exploitation and they own part of the company that helped it happen. That is happening on Facebook.”

Will child porn affect Facebook IPO?

In June 2011, the U.S. Department of State, in its annual Trafficking in Persons Report, stated, “Whether through issue-specific media, or far-reaching platforms such as Facebook and Twitter, the growing capacity of new media allows concerned parties around the world to connect and share information with a speed and breadth of access unimaginable at the start of the modern anti-slavery movement just a decade ago.”

Now, just as it’s about to go public, Facebook has expressed its intention to vastly expand its global user community.

“We continue to focus on growing our user base across all geographies, including relatively less-penetrated, large markets such as Brazil, Germany, India, Japan, Russia, and South Korea,” Facebook’s S-1 filing states. “We intend to grow our user base by continuing our marketing and user acquisition efforts and enhancing our products, including mobile apps, in order to make Facebook more accessible and useful.”

However, Bechard hopes another federal agency – the SEC – will take a close look at the sexual exploitation of children on Facebook before green-lighting the launch of the widely anticipated IPO that promises to make Zuckerberg the richest man in the world when adjusted for age.

A SEC spokesman told WND the commission focuses merely on securities laws. While he explained that he is prohibited from speaking about Facebook in particular, he said the SEC looks to see if a company’s filings have proper disclosures under those securities laws.

“We have regulation over securities and the disclosure of information behind those securities, but not regulation over the companies themselves,” he said. “We only have authority over certain things. The things we review on a filing under securities laws are a little different than what law enforcement can do. We have authority over making sure disclosures are accurate. We can’t comment on the individual reviews or the process while it’s being reviewed.”

Just months ago, Facebook finalized a settlement with another government agency, the Federal Trade Commission, after the Electronic Privacy Information Center and nearly a dozen other privacy and consumer groups filed a complaint with the agency claiming that the social network deceived its users by allowing personal and private information to be made public. As part of the settlement, Facebook agreed to 20 years of FTC privacy audits.

“The FTC and DPC (Irish Data Protection Commissioner) have investigated and audited aspects of our products and practices, and we expect to continue to be the subject of regulatory investigations and audits in the future by these and other regulators throughout the world,” Page 20 of Facebook’s filing states.

The FTC collects complaints about companies, business practices, identity theft and episodes of violence in the media.

However, when WND contacted the FTC to determine whether it had authority to investigate Facebook’s business practices with regard to prevention of child pornography from appearing on the website, an FTC spokesman refused to comment and, instead, directed WND to the Department of Justice.

Next, the Justice Department was contacted, and – upon describing the issue of child pornography on Facebook – WND was transferred by several employees to four separate DOJ offices.

WND asked a DOJ spokeswoman in the criminal division identifying herself as Alisa, if the Justice Department has ever investigated child pornography on Facebook. She replied, “I’m happy to check to see if we have information for you on that.”

Asked what Americans can do to stop the problem of child pornography on the social network, aside from reporting individual images to Facebook, she responded:

“Are you familiar with the DOJ’s prosecution of child pornography? We’ve taken down a number of online bulletin boards devoted to those types of images. Several of the cases that we’ve brought down are actually hidden from the public. So they actually go to extreme measures to hide themselves from law enforcement.”

She added, “I understand what you’re looking for, but I do want to also make sure you’re aware of the prosecutions we have been involved in.”

WND asked, “In the context of social networks, is locating this child pornography more challenging?”

She responded, “I will check with that and get back to you.”

The DOJ never provided the requested information to WND.

A message to Facebook investors

In its 163-page SEC filing, Facebook does not discuss its policies regarding pornographic content or efforts to prevent child pornography from appearing on its site.

However, Bechard has a message for all potential Facebook investors, large or small:

“If you are investing in Facebook, you are investing in a channel for child pornography and commercial sexual exploitation,” he said. “There’s no doubt about that.”

Bechard added, “So we leave it up to those who want to invest in this IPO and their moral conscience: Would you invest in a company you know to be involved in child pornography and commercial sexual exploitation of children?”

Likewise, Lepoutre admonished Facebook investors:

“The bottom line is: You don’t have clean hands.”

Read Part 1 and Part 2 of this series.

Concerned individuals may do the following:

Send a flood of 1st-class mailed postcards to Facebook’s Mark Zuckerberg, members of Facebook’s board and top-level management and staff telling them you want this criminal activity to stop.

Sign the petition to stop child porn on Facebook.

Contact members of Congress and urge them to act now.

If you have stumbled upon content appearing to be child pornography, report it immediately to the FBI’s Internet Crime Complaint Center.

(Part 4 of this series will examine the response of experts and advocacy groups in the ongoing battle against child porn on Facebook.)

 

Chelsea Schilling

Chelsea Schilling is a news and commentary editor for WND and a proud U.S. Army veteran. She has a master's degree in public policy and a bachelor's degree in journalism. Schilling also worked as a news producer at USA Radio Network and as a news reporter for the Sacramento Union. Read more of Chelsea Schilling's articles here.


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