Zuckerberg: Facebook will not launch Libra unless U.S. regulators approve

Ahead of Oct 23 hearing, Mark Zuckerberg has shared his testimony with the U.S. House of Representatives Committee on Financial Services addressing several concerns lawmakers have expressed over the launch of the Libra project.

In his testimony, Zuckerberg assures the committee members that “Facebook will not be a part of launching the Libra payments system anywhere in the world unless all U.S. regulators approve it“. He added, “We support Libra delaying its launch until it has fully addressed US regulatory concerns”.

Addressing concerns over Facebook’s payments platform

• On the concerns of platform used for money laundering or terrorist financing or illicit finance, Zuckerberg said that payments processed through Facebook’s licensed payments platform will leverage both automated systems and human review to monitor transactions and will report suspicious payment activity to applicable authorities.

• Speaking about Facebook’s access to people’s financial data via Calibra, Zuckerberg said that Calibra will be set-up as a regulated subsidiary so that there is a clear separation between Facebook’s social data and Calibra’s financial data.
  
  Calibra will not share customers’ account information or financial data with Facebook, except to prevent fraud or criminal activity, when users affirmatively choose to share their data, or when legally obligated to do so.

• Mark Zuckerberg also clarified that Libra is not an attempt to create or replace a sovereign currency and assured that Libra will work with the Federal Reserve and other central banks to make sure that it does not interfere with monetary policy.

Zuckerberg in his testimony also stressed the importance of innovation to maintain America’s financial leadership. Leveraging on China’s plan to launch a similar idea in the coming months, Zuckerberg said “Libra will be backed mostly by dollars” and believes that Libra can help to extend America’s financial leadership.

The public hearing before the U.S. House of Representatives Committee on Financial Services is on Oct 23, 2019. The hearing titled – “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors,” will have Zuckerberg as its witness.