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A top EU privacy regulator is looking into how millions of Instagram users' personal data was harvested by one of the company's partners (FB)

Thu, 08/08/2019 - 4:57pm

  • Hyp3r, a buzzy San Francisco startup, has been scraping millions of Instagram users' data, tracking their locations and saving their Stories posts. 
  • The Irish Data Protection Commission, a key EU data regulator, is now looking into whether EU data subjects were affected.
  • The locations Hyp3r targeted included places in the EU, so the answer to that is almost certainly yes.
  • Instagram issued Hyp3r with a cease and desist and kicked the company off its platform after Business Insider alerted it to Hyp3r's behaviour.
  • Hyp3r denies wrongdoing and says it abides by privacy regulations and social networks' terms of service.
  • Visit Business Insider's homepage for more stories.

A top data protection regulator in the European Union is looking into the systematic collection of Instagram users' personal data, including posts that were designed to disappear after 24 hours, by a San Francisco startup.

The Irish Data Protection Commission said on Wednesday that it is "working to establish" whether EU citizens have been affected by the data scraping, which was first revealed in a Business Insider investigation published Wednesday.

Marketing firm Hyp3r has been scraping millions of users' public data from the Facebook-owned photo-sharing app — tracking people's locations, saving their Stories posts (which are supposed to disappear after 24 hours), and gathering other information about them.

After Business Insider approached Instagram for comment, it issued Hyp3r with a cease and desist, and kicked the company off its platform.

Hyp3r had been operating in plain sight for a year, taking advantage of a weakness in Instagram's security, but Instagram failed to notice. Instagram even designated Hyp3r as an official "Marketing Partner." Sata scraping is widespread, and it is likely that many other outside firms were similarly taking advantage of Instagram's lax efforts to safeguard user data.

Hyp3r has denied wrongdoing, and CEO Carlos Garcia previously said in a statement: "HYP3R is, and has always been, a company that enables authentic, delightful marketing that is compliant with consumer privacy regulations and social network Terms of Services. We do not view any content or information that cannot be accessed publicly by everyone online."

SEE ALSO: Instagram's lax privacy practices let a trusted partner track millions of users' physical locations, secretly save their stories, and flout its rules

Reached for comment, the Irish Data Protection Commission — which is responsible for regulating Facebook and its subsidiaries in the EU — said it is trying to understand whether Europeans have been affected, before it takes next steps.

"We are aware of media reports in relation to this issue," a spokesperson told Business Insider in a statement. "We are working to establish whether EU data subjects have been affected in the first instance and will then assess whether further information from Instagram is required."

Europeans seem certain to have been affected by the data scraping; sources say Hyp3r harvested data from "geofenced" locations around the world, and marketing material released by hotel chain Marriott, one of its customers, said it "surfaces all public social posts shared by on-property guests across our entire portfolio of hotels worldwide." Marriott has numerous hotels in the European Union.

A Hyp3r spokesperson said that the company was compliant with GDPR, the EU's privacy regulation, and that it has not yet been contacted by the Irish DPC. Hyp3r encrypts all personally identifiable information, the company said, and is confident that issues with Instagram will soon be resolved.

In an interview on Wednesday set up by Hyp3r's PR team, Ray Kruk, CEO of  security and compliance firm Tugboat Logic, also said that his company has worked with Hyp3r to ensure compliance with GDPR and other international standards. Hyp3r has extremely high standards of security, he said, and takes "unbelievable measures to ... confirm with GDPR."

Kruk acknowledged that he did not have visibility into how Hyp3r's data was acquired.

A spokesperson for Instagram did not immediately respond to Business Insider's request for comment on Thursday.

Do you work at Instagram or Hyp3r? Got a tip? Contact this reporter via encrypted messaging app Signal at +1 (650) 636-6268 using a non-work phone, email at, Telegram or WeChat at robaeprice, or Twitter DM at @robaeprice. (PR pitches by email only, please.) You can also contact Business Insider securely via SecureDrop.

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US transportation officials just said Delta couldn't ban pit bulls from coming aboard as service dogs (DAL)

Thu, 08/08/2019 - 4:47pm

  • The US Department of Transportation issued a statement saying that airlines can't ban specific breeds of dogs from being brought aboard as service animals.
  • The ruling applies to Delta, which prohibited pit-bull service animals in 2018.
  • Service animals, which are typically highly trained to support a person with disabilities, are typically protected under the Americans with Disabilities Act.
  • Visit Business Insider's homepage for more stories.

The US Department of Transportation issued a statement on Thursday outlining what approaches airlines can and cannot take toward regulating emotional-support and service animals on flights.

Among the topics covered was a ruling that airlines may not impose limits on service animals that are solely based on the animal's breed. Specifically, if dogs are allowed on board as service animals, airlines can't differentiate between breeds.

Delta announced in 2018 it was banning "pit bull type dogs" as service or support animals.

However, the rule faced swift backlash from disability advocates who argued that service dogs were protected under the Americans with Disability Act. 

Service animals are trained and certified to perform tasks or provide support for people with disabilities, and are typically allowed to be taken to most public places. Similarly, airlines cannot charge fees for service animals.

Read more: American Airlines just announced 5 new routes that reflect its strategy to leverage its massive connecting network

Emotional-support animals, or "support animals," are not considered service animals, as they do not have the same level of training.

In the ruling, the DOT said it "views a limitation based exclusively on breed of the service animal to not be allowed under its service animal regulation."

The ruling said, however, that airlines were still "permitted to find that any specific animal, regardless of breed, poses a direct threat." It also said airlines were not allowed to require advance notice for passengers traveling with service animal "other than emotional support animals (ESAs) and psychiatric support animals (PSAs)."

The DOT also confirmed that airlines may ask passengers with service animals to "present documentation related to the service animal's vaccination, training or behavior so long as it is reasonable to believe that the documentation would assist the airline in making a determination as to whether an animal poses a direct threat to the health or safety of others."

In a statement, Delta said it would continue to assess its policies:

Delta continuously reviews and enhances its policies and procedures for animals onboard as part of its commitment to health, safety and protecting the rights of customers with disabilities. In 2018, Delta augmented its policies on service and support animals to reinforce our core value of putting safety and people first, always.

SEE ALSO: San Francisco Airport is banning plastic water bottles starting this month

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Uber plunges 12% after losing more money than expected (UBER)

Thu, 08/08/2019 - 4:46pm

  • Uber reported second-quarter earnings Thursday that fell short of analyst expectations. 
  • Shares tanked as much as 12% in aftermarket trading on the news. 
  • Uber's CEO Dara Khosrowshahi said that losses should come down in the next few years. 
  • Watch Uber trade live on Markets Insider.

Uber lost more money in the second quarter than experts expected.

Shares of Uber sank as much as 12% late Thursday after the company reported second-quarter earnings results that missed analyst expectations. It's worth noting, however, that Uber's stock rallied more than 8% during regular trading after riding the momentum of rival Lyft's strong report.

Here is what Uber reported versus what analysts surveyed by Bloomberg expected:

  • Revenue: $2.87 billion versus $3.05 billion expected
  • Earnings per share (GAAP): $-4.72 versus $-3.23 expected
  • Net loss: $5.24 billion, in-line with estimates
  • Gross bookings: $15.76 billion

The company posted a net loss of $5.24 billion for the quarter, which it said was mostly due to stock-based compensation from its May IPO. Without the stock-based compensation, losses were about $1.3 billion, 30% more than in the previous quarter. It also posted sales lower than what analysts expected. 

Revenue was $2.87 billion for the quarter, up 12% from the previous year but below the $3.05 billion that analysts anticipated. Gross bookings rose to $15.76 billion, an increase of 31%, but Uber Eats bookings were a smaller portion of that growth than analysts expected, bringing in only $3.39 million. 

The earnings miss comes just a day after Uber's top US competitor Lyft beat analyst expectations for its performance in the second quarter, sending shares up as much as 8%. Uber stock initially rose about 7% after Lyft's earnings beat. 

Uber's CEO Dara Khosrowshahi said that competition is cooling in the ride-hailing market. "We're definitely seeing the competitive environment improve," he said on a call Thursday. 

He also said that shrinking losses are in Uber's future. "We think that 2019 will be our peak investment year," he said. "In 2020, 2021, you'll see losses come down."

Uber was down 5% since its initial public offering through Thursday's close.

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Facebook is reportedly offering news publishers up to $3 million a year to license articles for an upcoming news section (FB)

Thu, 08/08/2019 - 4:36pm

Facebook is offering millions of dollars to news publishers to license their content and include it in a special section of the social network, according to a report in the Wall Street Journal on Thursday. 

The report, which cites anonymous sources, said that Facebook executives have pitched the offer to publications including Bloomberg, The Washington Post, ABC News, and the Wall Street Journal's own parent company, Dow Jones. Facebook execs have said they would be willing to pay up to $3 million a year for the right to articles, the report said.

The articles would be included in a special section within Facebook devoted to news that the company hopes to launch later this year, according to the Journal.  

Facebook executives did not immediately return Business Insider's request for comment.

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Uber just reported massive losses that were larger than Wall Street expected — and the stock is sinking (UBER)

Thu, 08/08/2019 - 4:30pm

  • Uber on Thursday reported second-quarter earnings that widely missed Wall Street expectations. 
  • The ride-hailing giant lost $4.72 per share on revenues of $3.17 billion.
  • A big chunk of Uber's massive $5.24 billion loss was because of stock-based compensation from its initial public offering earlier this year.
  • The stock was down as much as 12%, or $5.33, in after-hours trading.
  • Follow Uber's stock in real time here.

Uber on Thursday reported second-quarter losses that were wider than Wall Street's expectations. The stock was down as much as 12%, or $5.33, in after-hours trading.

Here are the important numbers: 

  • Revenue: $3.17 billion
  • Earnings per share (GAAP): -$4.72 versus -$3.23 expected
  • Net loss: $5.24 billion, in line with estimates
  • Gross bookings: $15.76 billion (up 37% year over year)

A major chunk of those losses, $3.9 billion, is from stock-based compensation to employees related to the company's initial public offering in May. It's a typical expense for companies who go public, and Uber previously warned in regulatory filings that this large expense would be occurring, so it likely isn't a surprise for investors. 

Even with the noncash expenses, Uber still burned through $920 million in cash during the three-month period. In the same period of 2018, the company spent $153 million.

"'We're very confident that this company, at maturity, can be cash-flow positive," CEO Dara Khosrowshahi said on a conference call with analysts. 

In order to stem its cash burn, Uber laid off 400 marketing employees last month. Those savings, which mostly affected brand marketing and weren't limited to any one geographic area, won't be seen until next quarter. 

Read more: Uber marketing employees describe this week's 'bloodbath' when the company laid off 400 employees in more than a dozen countries in one day 

"While we will continue to invest aggressively in growth, we also want it to be healthy growth, and this quarter we made good progress in that direction," Nelson Chai, Uber's chief financial officer, said in a press release.

Uber's stock has struggled to remain above its first trading price since its May IPO, but it got a major boost on Thursday following Lyft's earnings report on Wednesday afternoon. 

Lyft's report, 24 hours ahead of Uber, handily topped Wall Street expectations. The smaller company, which operates only in North America, as opposed to Uber's global reach, raised its guidance for investors. Wall Street now thinks Lyft could reach profitability sooner than previously expected.

Gross bookings, a closely watched measure for ride-hailing investors that includes most fares and Uber Eats receipts before paying drivers or couriers, reached $15.76 billion. That's a 37% increase from the previous year, Uber said. 

Troy Wolverton contributed to this report. 

More Uber news: 

SEE ALSO: Uber marketing employees describe this week's 'bloodbath' when the company laid off 400 employees in more than a dozen countries this week

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34 companies funded by Stephen Ross, the Equinox and SoulCycle owner facing controversy due to ties with Trump

Thu, 08/08/2019 - 4:21pm

  • The backlash against Equinox and SoulCycle in response to a Washington Post report that unearthed owner Stephen Ross' ties to President Donald Trump is showing no signs of slowing down.
  • Ross — an investor and real-estate mogul who also notably owns the Miami Dolphins — has an ownership stake in several other buzzy brands through his firms Related Cos. and RSE Ventures.
  • These brands include trendy eateries like Momofuku, Milk Bar, &pizza, and Bluestone Lane; media companies like VaynerMedia and Derris; and major sporting events, including the Miami Open and International Champions Cup.
  • Visit Business Insider's homepage for more stories.

As angry consumers continue to cancel their Equinox memberships and SoulCycle classes upon learning of owner Stephen Ross' ties to President Donald Trump, many may be surprised to find out the investor's brand portfolio runs quite deep. 

Ross holds an ownership stake in 15 brands as the founder and chairman of Related Cos., including buzzy eateries like Momofuku and Bluestone Lane, as well as media companies like VaynerMedia. On Thursday morning, Related had blocked public access to view its list of brands, rendering a message that says "you are not authorized to access this page." Related has not yet responded to Business Insider's request to comment on the change.

Additionally, Ross' venture-capital firm, RSE Ventures — which specializes in sports, entertainment, media, and technology, according to its website — has backed numerous other companies across a wide spectrum of industries. 

Business Insider has reached out to all 34 brands listed as financially tied to Ross and has included their comments below.

Read more: People are threatening to quit Equinox and SoulCycle following a report that the chairman of the trendy fitness brands plans to host a Trump fundraiser

The boycotts erupted on Wednesday when The Washington Post reported that Ross would be hosting a fundraising event for Trump at his New York home in the Hamptons on Friday, with tickets selling for as much as $250,000.

In response, #GrabYourWallet founder Shannon Coulter urged consumers to boycott Ross-owned companies, and several notable figures, including Chrissy Teigen, Billy Eichner, and Ilana Glazer, said on social media they planned to cancel their Equinox memberships. 

On Wednesday night, Ross shared a statement with the Miami Herald reporter Adam Beasley, in which he mentioned his decades-long relationship with Trump and his intention to work with "leaders on both sides of the aisle" to address his "deep concern for creating jobs and growing our country's economy." 

"I always have been an active participate in the democratic process," Ross said in the response. "While some prefer to sit outside of the process and criticize, I prefer to engage directly and support the things I deeply care about. I have known Donald Trump for 40 years, and while we agree on some issues, we strongly disagree on many others and I have never been bashful about expressing my opinions."

We took a closer look at the companies in Ross' brand portfolio. Here they are:

SEE ALSO: Crunch Fitness is trying to win over people ditching Equinox and SoulCycle in protest of the trendy fitness brands' chairman's ties to Trump


Equinox is a luxury fitness and lifestyle company that boasts several celebrity clients and pricey memberships.

Equinox issued a statement on Wednesday.

The company sought to distance itself from the fundraiser and said it had "nothing to do with the event" and did not support it.


SoulCycle, which is owned by Equinox, is an upscale cycling studio. 

SoulCycle CEO Melanie Whelan responded to the controversy in a tweet on Wednesday.

The CEO said SoulCycle "in no way endorses" the Trump fundraiser hosted by Ross and the investor "is not involved in the management" of the company.


VaynerMedia is a digital-media company. A spokesperson for VaynerMedia declined to comment when contacted by Business Insider.

Bluestone Lane coffee

Bluestone Lane is a cafe and coffee company. 


&pizza is a trendy pizza company primarily on the East Coast. 


On Thursday, David Chang, the founder and head chef of the Momofuku restaurant group, used his podcast, "The Dave Chang Show," to share an impassioned response denouncing Ross' ties to Trump. 

"I personally am a staunch opponent to President Trump and everything he stands for," Chang said on the podcast. "I f---ing hate him. Anyone that normalizes gun violence, white supremacy, putting kids into cages, his general lack of decency and respect for anyone else — he is destroying our democratic norms. I cannot stand behind him." 

Chang continued, thanking Ross for his support over the years before urging him to cancel the fundraiser. 

"I'm imploring you to reconsider hosting this fundraiser," he said. "It flies in the face of everything we believe in at Momofuku. It frightens many of the people that work for you, and it contradicts what I hoped to accomplish before taking your money in the first place."

Milk Bar

Milk Bar is a popular bakery run by Christina Tosi as part of the Momofuku restaurant group. 




Milk Bar CEO Christina Tosi issued a statement in the wake of the backlash.

Tosi wrote that Milk Bar "is in no way affiliated with the Trump fundraiser" and that "company decisions are all made independently by the Milk Bar team and me." The CEO also said that she personally did not support Trump's policies and that Milk Bar believes "unequivocally in equal rights for all."

Blink Fitness

Blink Fitness has more than 80 locations across the US. 

Snark Park

Snark Park is an experiential exhibition space in Hudson Yards in New York City.  

Pure Yoga

Pure Yoga is a series of yoga studios in New York City.


Virginia Lam Abrams, the spokesperson for the internet service provider Starry, wrote in a statement to Business Insider that Related is only a minority investor and holds no board seat for the privately held company. Still, Related plays an integral role in their business. 

"We work with Related Companies to connect their apartment communities with competitive, affordable broadband service," she wrote. "In particular, they are an important partner for us in enabling Starry to deploy free and low-cost internet access solutions in their affordable housing portfolio, which is the largest in the nation. As companies, we are aligned with the shared mission of lowering barriers to broadband access and providing consumers with competitive alternatives to the incumbent monopolies. That is what makes Related Companies a great partner as we grow and expand our network."

She added: "Mr. Ross's personal political viewpoints and his decision to host this fundraiser are entirely his own."

Pocket Living

Pocket Living helps first-time home owners navigate real estate in London. 

Dog City

Dog City is a dog day-care service. 

Hudson Yards

Related Cos. invested $25 billion in the development of Hudson Yards, the massive real-estate complex in New York City.


Shaun Osher, the founder and CEO of the boutique real-estate firm Core, shared the below statement with Business Insider:

"As a naturalized American who immigrated to the US in my twenties from South Africa, and who lived for years in fear of being deported while my immigration status was being sorted, I hope that Mr. Ross spends his time with the President advocating for the humane treatment of all people wishing to live here in peace, immigrants and non-immigrants alike," he wrote.

He added: "I wish that all those attending the event push for the American dreams and values that brought me here in the first place. Anything less undermines the very idea of America's greatness  — a haven for those wishing to reach the highest potential for themselves and their families. The very reason so many of us risked everything to be here today."




Miami Dolphins

The Miami Dolphins are part of the NFL. 

Hard Rock Stadium

Hard Rock Stadium is home to the Miami Dolphins. 


Lola is a feminine-care company that sells organic tampons. 

International Champions Cup

The International Champions Cup is a major global soccer tournament. 

Miami Open

The Miami Open is an annual tennis tournament. 

Drone Racing League

DRL is a global professional racing league for drone pilots. It declined to comment.

Skout Cybersecurity

Skout delivers cybersecurity protection to companies.

Outstanding Foods

Outstanding Foods makes popular snacks like Pig Out Chips. 


Banza is a gluten-free-pasta company. 


Derris is the public-relations agency that represents buzzy brands like Glossier, Everlane, and Warby Parker. 


FanVision develops mobile technology for car racing. 


Omaze is an online fundraising platform. 


Krossover is a sports-coaching service that offers post-game analysis and statistics.

Crossfield Digital

Crossfield Digital develops mobile apps and websites. 


Radiate is a video-education company for C-suite executives. 


NextVR is a virtual-reality company. 


PrimeSport is a global sports-travel and event-management company.

Student Sports

Student Sports is a marketing organization for student athletes. 


June is a modern-appliance company that makes products for a smart and connected kitchen. 

Shoshy Ciment and Irene Jiang contributed reporting to this story. 

Stocks erase weekly losses as China trade-war tensions simmer

Thu, 08/08/2019 - 4:17pm

Stocks erased weekly losses on Thursday after China continued to stabilize the yuan, alleviating worries of a currency war breaking out with the US. It also calmed nerves around the global trade conflict.

China set the yuan's fixing price just above 7 yuan per dollar — a higher-than-expected level — prompting investors to exit safe haven assets like bonds and gold.

Elsewhere, the yield on the 10-year Treasury note extended its weekly slump. Gold also dropped off its 6-year high and dipped below $1,500 during intraday trading. 

Here's a look at the major indexes as of the 4:00 p.m. close: 

Chinese said its exports rebounded from a 1.3% decline in June, and climbed 3.3% in July from the same month last year as shipments to Europe and Southeast Asia increased. The upbeat data lifted some uneasiness over trade tensions potentially pushing the global economy toward a recession. 

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Stocks experienced a sharp sell-off earlier in the week after China allowed the value of its currency to drop below 7 yuan per US dollar, sparking the initial fears of the trade war evolving into a battle of currencies. On Wednesday, Central banks in Thailand, New Zealand, and India took measures to prop up economic growth by lowering interest rates prompting a rally in global stocks. 

President Trump doubled-down on his criticism of the Federal Reserve on Thursday writing in a tweet that the central bank has "called it wrong at every step of the way." The president also said he was disappointed with the strength of the US dollar, which he has consistently supported weakening to make US exports cheaper and more competitive. 

Within the S&P 500, these were the largest gainers:

And the largest decliners:

Warren Buffet-backed Kraft Heinz slid as much as 16% to a record intraday low after the company's delayed-earnings results missed expectations. The food conglomerate also announced $1.2 billion in business write-downs. Buffet owns about 27% of the company. 

Shares of Lyft rose as much as 9% after the ride-sharing company reported second-quarter earnings that surpassed Wall Street forecasts. The company recorded $867 million in revenue during the second quarter, with a loss per share of $0.68. Analysts expected revenue of $809 million and a loss per share of $1.74. 

Every sector within the S&P 500 rose on Thursday, with both technology and energy stocks gaining more than 2%. 

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Cannabis-related job searches have skyrocketed over 650% in the past 3 years. Here's who's hiring and what skills you need to get in.

Thu, 08/08/2019 - 3:42pm

  • Cannabis-related job postings in the US have quadrupled in the past three years as more states legalize the drug, according to a new report from the job site Indeed.
  • During the same time period, cannabis-related job searches increased 650%, indicated a huge demand for jobs in the brand new industry.
  • See below for a list of who's hiring, and sign up for our new cannabis newsletter, Cultivated

Cannabis legalization is spreading around the US and job-seekers are highly interested in the brand-new industry, according to a new report from the employment-search firm Indeed.

Since 2016, cannabis-related job searches have skyrocketed 650%, according to Indeed economist Andrew Flowers. Over the same time period, the number of cannabis-related job postings has quadrupled, from 231 per million in May 2016 to 915 per million in May 2019.

"There are very few industries have seen a seven-fold increase in job seeker searches in three years," Flowers said in an interview. "Very few." 

Read more: From a master's in medical cannabis to a minor in weed, these are the college programs growing the next crop of marijuana entrepreneurs

In the past year alone, cannabis-related job postings have increased by 90%, according to Flowers. And if you want to land a gig in the booming industry, your best bet is probably in sales and retail.

The most common cannabis job posting on Indeed is for "budtender," which is a person who works at a dispensary and helps customers navigate the plethora of pot products. Coming in at number two is "sales associate" followed by "sales representative."

The second basket of popular cannabis jobs is all around the growing and cultivating of the crop itself, for positions like "grower," "trimmer," and "agriculture technician." And third, medical cannabis companies are hiring pharmacists and physicians to help research cannabis-based drugs and diagnose patients.

This year, Harvest has the most job openings among US cannabis companies, followed by Smoker's Choice, and Cresco Labs. On the cannabis-tech side, Weedmaps is hiring lots of data scientists and software engineers.

A quick scan of Harvest's job board shows hiring across divisions include sales, marketing, retail, and legal, meaning there is lots of opportunity for those with different skill sets to jump into the cannabis industry.

Cannabis is legal for adult use in 11 states and medically legal in 33 states. Illinois became the latest state to legalize earlier this year.

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Leslie Wexner, the billionaire behind Victoria’s Secret, says disgraced financier Jeffrey Epstein misappropriated at least $46 million from him

Thu, 08/08/2019 - 12:29am

  • Victoria's Secret billionaire Leslie Wexner said convicted sex offender Jeffrey Epstein "misappropriated vast sums of money" from his fortune while Epstein was his financial advisor.
  • Wexner was one of Epstein's only known clients, and observers say that Epstein's decades-long relationship to the high-powered billionaire contributed to his success
  • While the two had previously been described as "close personal friends," Wexner last month said he "regretted" ever crossing paths with Epstein and said he "completely severed" all ties with Epstein 12 years ago.
  • Epstein was arrested last month and charged with sex trafficking and conspiracy to commit sex trafficking. He has pleaded not guilty. If convicted, he faces up to 45 years in prison.

Victoria's Secret billionaire Leslie Wexner said convicted sex offender Jeffrey Epstein "misappropriated vast sums of money" from his fortune while Epstein was his financial advisor.

In a letter to members of his namesake Wexner Foundation, seen by the Wall Street Journal, the CEO and founder of L Brands, the parent company to Victoria's Secret, claimed that Epstein "had misappropriated vast sums of money from me and my family."

"This was, frankly, a tremendous shock, even though it clearly pales in comparison to the unthinkable allegations against him now," Wexner continued in the letter.

According to CNBC, Wexner's letter did not specify how much money was recovered from Epstein's financial mismanagement. Though according to The Journal, tax records indicate that Epstein made a $46 million contribution to a Wexner charitable fund in January 2008. In his letter, Wexner alleged in his letter that this amount represented only a "portion" of the total sum mishandled by Epstein.

He added that "every dollar" of that money originally belonged to the Wexner family. A representative for Wexner did not comment to The Journal on whether the "misappropriation" was reported to authorities.

Business Insider could not immediately reach an attorney for Epstein for comment.

According to the New York Times, Wexner gave Epstein power of attorney in 1991, handing the disgraced financier almost complete control of his financial affairs for more than a decade. The power allowed Epstein to hire people, sign checks, buy and sell properties, and even borrow money on Wexner's behalf. 

Wexner was also one of Epstein's only known clients, and observers say that Epstein's decades-long relationship to the high-powered billionaire contributed to his success. Epstein is said to have received millions of dollars from Wexner, and reportedly owned mansions and private planes previously owned by Wexner or his companies. 

Read more: Victoria's Secret billionaire Leslie Wexner gave near-total control of his finances to Jeffrey Epstein, according to a stunning new account of their controversial friendship 

While the two were described as "close personal friends" in a 2002 lawsuit, the relationship between them soured after charges of sexual misconduct against Epstein surfaced. Wexner last month wrote in a company memo that he "regretted" ever crossing paths with Epstein and said he "completely severed" all ties with Epstein 12 years ago.

Epstein pleaded guilty to state charges of soliciting prostitution in June 2008 and registered as a sex offender as part of a deal cut with the US Attorney's Office in Miami. He was sentenced to 18 months in prison but only served 13 months in a private wing of the Palm Beach County Jail where he was allowed to work in an office six days per week.

Epstein was arrested last month and charged with sex trafficking and conspiracy to commit sex trafficking. He has pleaded not guilty. If convicted, he faces up to 45 years in prison.

SEE ALSO: Jeffrey Epstein reportedly lived the life of a billionaire thanks to hand-me-downs from Victoria's Secret head Les Wexner

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Eco-friendly home product maker Grove Collaborative acquires feminine care startup Sustain Natural for undisclosed amount

Thu, 08/08/2019 - 12:01am

  • On Thursday, eco-friendly cleaning and home product maker Grove Collaborative announced it had acquired feminine care startup Sustain Natural for an undisclosed amount.
  • Meika Hollender, Sustain Natural's cofounder and CEO, will remain at the head of the Sustain brand under Grove Collaborative cofounder and CEO Stuart Landesberg.
  • At the time of the deal, Sustain had 15 full-time employees, Hollender confirmed to Business Insider. She said they had to "move away" from a significant portion of the team, but would not confirm how many, if any, were joining her at Grove Collaborative.
  • Hollender said Sustain Natural was fundraising when she was approached by Landesberg. 
  • The Vermont-based startup had raised a little over $10 million in three angel funding rounds since 2013. Its most recent round was in January, according to Pitchbook data.
  • Click here for more BI Prime stories.

Grove Collaborative, an eco-friendly home products startup, isn't letting its $212 million in venture funding go to waste.

On Thursday, the subscription service announced it was acquiring Vermont-based Sustain Natural, a sustainable line of feminine hygiene and sexual health products, for an undisclosed sum. 

"It's mind blowing that we got to sell our business to another B Corp that values sustainability," Sustain Natural cofounder and CEO Meika Hollender told Business Insider. A B Corp is a private certification given to for-profit companies focused on environmental sustainability. "I had mixed feelings about what an exit for Sustain would look like because we are so committed and mission driven," Hollender said.

Read More: Startups with women founders are on track to see record venture investment in 2019

Hollender will remain on as head of the new Sustain Naturals brand under Grove Collaborative cofounder and CEO Stuart Landesberg. Landesberg told Business Insider that he had been a fan of Hollender's for a while, and was pleased with how the partnership ultimately shook out given the similar missions and certifications of their businesses (both are certified B Corporations). 

"Who you can exit to has changed and that was exciting," Hollender said of the deal. "They can sell our product to their customers because they are our customers and we were going to go after them anyway."

Landesberg's company, which sells eco-friendly cleaning, home, and personal products as part of a subscription model, currently partners with Sustain Natural competitors Seventh Generation and Kora. Hollender's father, Jeffrey, was the cofounder and CEO of Seventh Generation before starting Sustain Naturals in 2013 with Meika.

"Beyond the incredible assortment and products Sustain has, we look up to Meika and the mission of Sustain," Landesberg told Business Insider. "We benefit from having the experience that Meika brings in and actually getting stuff done in a way that's pretty unusual."

Although Hollender will be joining Landesberg and team in Grove Collaborative's San Francisco headquarters, she said Sustain Natural had to "move away" from a significant portion of its 15-person team, but would not confirm how many, if any, were joining her at Grove Collaborative. The brand will act be a subsidiary of Grove Collaborative moving forward, so primary functions like customer service and acquisition will fall to the startup's 150-person team in Portland, Oregon. 

Sustain Natural had raised a little over $10 million in angel funding since 2013, according to Pitchbook data. The company most recently granted a majority ownership to Combe, the creator of feminine care products like Vagisil, for $2.5 million in January.

"We were getting ready to fundraise and whenever you are there, acquirers and that sort come knocking," Hollender said. "It has always been on our mind, but we were not actively looking for an exit at this moment."

SEE ALSO: 2 years after the founder of 500 Startups left amid sexual harassment allegations, 2 women are running the firm and setting a new bar in the male-dominated business

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A new lawsuit accuses Apple of violating user's privacy by allegedly allowing Siri to record without consent (AAPL)

Wed, 08/07/2019 - 6:27pm

  • A recently filed class-action lawsuit accuses Apple of violating user privacy by allegedly recording consumers and minors with its Siri digital assistant without consent.
  • The lawsuit comes after The Guardian reported that the contractors Apple hires to evaluate Siri's performance regularly hear confidential interactions.
  • Apple announced that it was suspending its Siri grading program globally following the report.
  • Amazon also came under fire earlier this year over how it handles Alexa recordings.
  • Visit Business Insider's homepage for more stories. 

Apple is facing a class-action lawsuit claiming that the company's Siri voice assistant is violating customer privacy by allegedly recording users without their consent.

The lawsuit, which Bloomberg first reported, comes after The Guardian discovered that the contractors Apple hires to evaluate Siri's performance regularly hear confidential interactions that may have occurred when Siri was triggered unintentionally. Apple announced that it was suspending its Siri grading program globally following the report.

The lawsuit alleges Siri users are being recorded without their consent and accuses Apple of failing to inform consumers that could happen.

Apple did not immediately respond to Business Insider's request for comment regarding the lawsuit.

Apple isn't the only company to come under fire for the way it manages recordings picked up by its virtual assistant. Privacy concerns over Amazon's Alexa bubbled up earlier this year after Bloomberg reported that the retail giant had hired thousands of people to listen to voice recordings captured by its Echo smart speakers to improve its accuracy. 

What happens to your Siri requests

When you ask Siri a question, your name and the request you've asked Siri is sent to Apple's voice-recognition servers. But that information is tied to a random identifier that your device generates, meaning it's not associated with your Apple ID.

The company saves voice recordings for up to six months at a time to improve Siri's accuracy. After that six-month period, it saves another copy of the data without its identifier for up to two years. Apple may also save some recordings, transcripts, and associated data beyond that two years to improve Siri, and in the past some of that data had gone through a grading process that involved human reviewers.

Apple has since suspended that grading program, but it's unclear if it made any other changes in regards to how it handles user data.

SEE ALSO: Apple's first foldable device could arrive in 2021, but it might not be an iPhone

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A Trump executive order geared toward addressing allegations of anti-conservative bias on social-media services like Twitter and Facebook is reportedly in the works

Wed, 08/07/2019 - 5:50pm

The White House is reportedly floating several drafts of an executive order directed at tech giants like Facebook, Google, and Twitter.

The executive order, which was first reported on by Politico, is said to be "in flux," but its objective is clear: to address the allegations of anti-Trump and anti-conservative bias that President Donald Trump has repeatedly made regarding social-media companies.

"There's no doubt in my mind that I should have millions and millions of people," Trump said in mid-July at an event billed as a White House social-media summit. "But I know that we've been blocked. People come up to me and say, 'Sir I cannot follow you' … They make it absolutely impossible."

Trump has yet to present any evidence to back up these claims.

It's not clear if the executive order would address those allegations directly or how it would address the alleged bias in services owned and operated by private corporations. Sources with knowledge of the executive order's drafting told Politico that such an order shouldn't be expected "imminently."

When reached for comment, the White House press representative Judd Deere told Business Insider, "The President announced at this month's social-media summit that we were going to address this, and the administration is exploring all policy solutions."

He wouldn't confirm the report but did point to Trump's quotes at the social-media summit. "Today, I'm directing my administration to explore all regulatory and legislative solutions to protect free speech and the free-speech rights of all Americans," Trump said in July. "Big tech must not censor the voices of the American people."

SEE ALSO: Trump accuses Twitter and Facebook of censoring him and conservative commentators during bizarre 'social-media summit'

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AMG is offloading its majority stake in struggling hedge fund BlueMountain for $91 million

Wed, 08/07/2019 - 5:49pm

  • Affiliated Managers Group sold its majority stake in Andrew Feldstein's BlueMountain Capital to Assured Guaranty, a Bermuda-based municipal bond and infrastructure insurer, for $91 million.
  • The deal is expected to close at the end of the year, and Feldstein will net $22.5 million in shares of Assured Guaranty as a part of the deal. 
  • BlueMountain's performance struggles this year forced AMG to write-off a $415 million loss earlier this year, and the hedge fund recently lost its head of fundamental credit. 
  • For more stories like this, visit Business Insider's homepage

For $91 million, Affiliated Managers Group has sold its share in Andrew Feldstein's struggling BlueMountain Capital roughly 12 years after buying it. 

The deal, which was reported by Bloomberg on Wednesday and then confirmed by a statement from AMG, will close at the end of the year, when Assured Guaranty, a Bermuda-based insurer of bonds and infrastructure, will take control of the credit-focused hedge fund.

Assured also bought out the partners at BlueMountain, leaving Feldstein with roughly $22.5 million in Assured shares and a new title of CIO and head of asset management.

Feldstein's co-founder Stephen Siderow will keep his title as co-president of BlueMountain. 

"We are pleased to have had a good partnership with BlueMountain over many years, and also that we worked closely with our long-term partners at BlueMountain to achieve an outcome that is in the best interests of BlueMountain's clients and employees and AMG's shareholders," said AMG CEO Jay Horgen in the statement. 

See more: BlueMountain's flagship fund is losing money so far this year even as the rest of the industry surges, and it's just the latest blow for the hedge fund

BlueMountain's tough run to start 2019 was not easy on its performance or its biggest backer. The firm's flagship fund, the Credit Alternatives fund, faltered as others in the industry notched impressive returns, and AMG was forced to take a $415 million write-down on its BlueMountain stake.

The hedge fund was working to meet profitability targets that AMG was pushing for by the end of year, which included cutting the firm's long-short equity and systematic equity strategies. The firm was also tied up in the utility PG&E, which was found to be at least partially responsible for some of California's deadly wildfires in 2017 and 2018.

BlueMountain decided to axe the two equity strategies and focus on its strengths, such as the credit investments the firm made its name on. But the firm's head of fundamental credit, Omar Vaishnavi, left just a month after giving an investment pitch on the fund's behalf at a New York conference. 

See more: BlueMountain's head of fundamental credit is leaving the firm. Here's one of the last investments he pitched.

Assured will hold its second-quarter earnings call on Thursday morning. The company plans on spending $90 million on BlueMountain's operations within a year of the deal closing, and will invest another $500 million into BlueMountain products over three years.

"We have been searching for the right asset management platform for over three years, and we found it in BlueMountain, a seasoned asset management firm with a compatible credit culture, complementary market knowledge and the scale to make a material contribution to Assured Guaranty's profitability," Dominic Frederico, Assured Guaranty's chief executive officer, said in the statement.

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CASE STUDY: Interview with PayPal COO Bill Ready on how Venmo evolved from a P2P powerhouse into a full-suite commerce engine (PYPL)

Wed, 08/07/2019 - 5:00pm

PayPal has long been a commerce enabler, offering highly popular services like PayPal OneTouch, a buy button with a wide reach in addition to loyalty and conversions that far surpass the competition's.

But it's also a leader in the digital peer-to-peer (P2P) payments space, as a wider set of users turn to PayPal apps, including Braintree-owned Venmo, for fast, simple, and convenient ways to pay their friends and family.

As digital P2P grows, and users continue to spend and buy online more than ever, PayPal has identified an opportunity to grow its commerce presence onto another platform, expand the services it offers, and better serve its customers in a time where returns and margins are shrinking across the payments space.

Business Insider Intelligence spoke to PayPal COO Bill Ready about how the firm is working to evolve Venmo — one of the most "beloved" apps in the millennial demographic and a P2P market leader — from a P2P offering to a full suite commerce engine.

Simply click here and enter your email address to receive a download of our full Venmo case study completely FREE!

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Instagram's lax privacy practices let a trusted partner track millions of users' physical locations, secretly save their stories, and flout its rules (FB)

Wed, 08/07/2019 - 4:56pm

  • A buzzy San Francisco startup has been secretly saving what appears to be millions of Instagram users' stories and tracking their locations.
  • The marketing firm Hyp3r has been scraping huge quantities of data off the Facebook-owned app and using it to build up detailed profiles of people's movements and interests.
  • The situation highlights how Facebook is still struggling to protect users' data and oversee developers accessing its platform, more than a year after the Cambridge Analytica scandal revealed important privacy lapses.
  • Instagram has now issued Hyp3r a cease and desist, kicked it off its platform, and made changes to its platform to protect user data.
  • EDITOR'S NOTE: This story would normally be exclusive to BI Prime members. However, because of the public interest in this reporting, we're making this story free to read for a limited time.

A combination of configuration errors and lax oversight by Instagram allowed one of the social network's vetted advertising partners to misappropriate vast amounts of public user data and create detailed records of users' physical whereabouts, personal bios, and photos that were intended to vanish after 24 hours.

The profiles, which were scraped and stitched together by the San Francisco-based marketing firm Hyp3r, were a clear violation of Instagram's rules. But it all occurred under Instagram's nose for the past year by a firm that Instagram had blessed as one of its preferred "Facebook Marketing Partners."

On Wednesday, Instagram sent Hyp3r a cease-and-desist letter after being presented with Business Insider's findings and confirmed that the startup broke its rules.

"HYP3R's actions were not sanctioned and violate our policies. As a result, we've removed them from our platform. We've also made a product change that should help prevent other companies from scraping public location pages in this way," a spokesperson said in a statement.

The existence of the profiles is a stark indication that more than a year after revelations that Facebook users' data was exploited by Cambridge Analytica to fuel divisive political ad campaigns, Facebook's struggles in locking down users' personal information not only persist but also extend beyond the core Facebook app. Instagram, which is owned by Facebook but operated as a mostly separate business, has been largely insulated from the privacy backlash and scrutiny that has rocked its parent company.

But the wealth of the data contained in people's fleeting Instagram activity, from family-vacation snapshots to restaurant appetizer photos, can provide valuable fodder for a variety of outside actors, who can repurpose the information in ways users never expected or agreed to.

Business Insider spoke with multiple former employees of Hyp3r to learn about its practices and reviewed public documents and marketing materials that outline its capabilities.

The total volume of Instagram data Hyp3r has obtained is not clear, though the firm has publicly said it has "a unique dataset of hundreds of millions of the highest value consumers in the world," and sources said more than of 90% of its data came from Instagram. It ingests in excess of 1 million Instagram posts a month, sources said.

Data scraping is a persistent problem across the web for open platforms. Instagram is not the only service to have been affected over the years, and Hyp3r is almost certainly not the only business scraping its data. But the nature of Hyp3r's activity raises significant questions about the extent of the due diligence that Instagram and parent company Facebook conduct on partners using their platform, as well as on their own procedures to safeguard user data.

"For [Instagram] to leave these endpoints open and let people get to this in a back channel sort of way, I thought was kind of hypocritical," one former Hyp3r employee said. It takes very little effort for Instagram to protect the location data accessed by Hyp3r, they said: "Why they haven't done it remains a mystery."

Hyp3r denied breaking Instagram's rules, essentially arguing that accessing public data on Instagram in this way is legitimate and justifiable, and saying it was confident that any issues with Instagram would be resolved shortly.

CEO Carlos Garcia said in an emailed statement: "HYP3R is, and has always been, a company that enables authentic, delightful marketing that is compliant with consumer privacy regulations and social network Terms of Services. We do not view any content or information that cannot be accessed publicly by everyone online."

'A location-based marketing platform'

Hyp3r, founded in 2015, describes itself as "a location-based marketing platform that helps businesses unlock geosocial data to acquire and engage high-value customers."

In simpler terms: Hyp3r is a marketing company that tracks social-media posts tagged with real-world locations. It then lets its customers directly interact with those posts via its tools and uses that data to target the social-media users with relevant advertisements. Someone who visits a hotel and posts a selfie there might later be targeted with pitches from one of the hotel's competitors, for example.

To provide some of these capabilities, Hyp3r made unauthorized use of Instagram data in three key ways:

  1. It took advantage of an Instagram security lapse, allowing it to zero in on specific locations, like hotels and gyms, and vacuum up all the public posts made from the locations.
  2. At these locations, it systematically saved users' public Instagram stories — a type of content designed to vanish after 24 hours —including the individual photos that users shared in the stories, in a clear violation of Instagram's terms of service.
  3. It scraped public user profiles on a broad basis, collecting information like user bios and followers, which it then combined with the other location information and data from other sources.

It also uses image-recognition software on users' posts it collects to automatically analyze what they're depicting.

Hyp3r did not access any nonpublic data from Instagram users who set their profiles' privacy settings to "private."

The result of the public information it gleaned was a sophisticated database about Instagram users, their interests, and their movements that Hyp3r openly touted to customers as one of its key selling points, despite the fact that Instagram's policies were structured so that such a thing would not be possible.

Hyp3r's data scraping was a response to post-Cambridge Analytica changes

Hyp3r is not a shady boiler-room operation.

The buzzy startup has raised tens of millions of dollars, including a $17.3 million funding round in September from backers such as Silicon Valley Bank and Thayer Ventures. It has won multiple awards — including a "Most Innovative Company" accolade from Fast Company in 2019 and 2018, and a Cannes Lions award in 2017. It counts marquee brands like Marriott International, Pepsi, Hard Rock, and 24 Hour Fitness among its clients, and Jim Messina, a former Obama aide, sits on its board.

Some of Hyp3r's behavior was once permitted by Instagram. 

Like many big platforms, Instagram has an API, or application programming interface, that allows developers to build services that can interact with its platform. (They're the reason you can save files to Dropbox from Microsoft Office or see your Facebook friends on Spotify, for example.)

But revelations in March 2018 about the political-research firm Cambridge Analytica's misappropriation of 87 million Facebook users' data — data which was originally collected via a quiz app built on top of Facebook's API years prior — prompted a sea change for Facebook, including at Instagram.

Before the scandal broke, Instagram's API allowed developers to search for public posts for a given location. But in the aftermath of it, Instagram began to deprecate (i.e. switch off) a bunch of its API's functionality, including location tools — causing chaos for companies, like Hyp3r, that had been relying on it.

Publicly, Hyp3r welcomed Instagram's API changes, writing a worthy blog post in which it said it "understand[s] and welcome[s] the changes that Facebook is making to protect the privacy of all of us," and promising its data would never be used for political purposes.

But behind the scenes, the company got to work building a system that could disregard Instagram's decision and keep on harvesting data anyway, sources told Business Insider.

Hyp3r geofenced thousands of locations around the world, then slurped up public posts

Hyp3r created a tool that could "geofence" specific locations and then harvest every public post tagged with that location on Instagram.

The result is a database of thousands of locations, including "hotels, casinos, cruise ships, airports, fitness clubs, stadiums and shopping destinations across the globe," as well as hospitals, bars, and restaurants. 

If a user makes a post at one of these locations, it is, unbeknownst to them, saved to Hyp3r's systems indefinitely, sources said, along with other information including a link to their profile picture, their profile bio, and their number of followers.

Ordinary users' Instagram stories — posts that are supposed to disappear after 24 hours — have never been available through Instagram's API. But Hyp3r built a tool to collect them too, sources said, saving the images indefinitely, along with the associated metadata. (The official API allows access only to stories of business accounts and creator accounts, a tiny fraction of the Instagram population, and these are not surfaceable by location.)

The posts and stories Hyp3r collected were available publicly — but viewable only as single pieces of content. By harvesting them systematically from popular locations, Hyp3r became able to build up detailed profiles of huge numbers of people's movements, their habits, and the businesses they frequent over time.

Imagine visiting a new city and sharing a geotagged story with friends of the hotel you visited. By itself, it doesn't tell viewers much about you.

But combine it with the story you posted from the hospital you visited for a checkup, and the selfie you made the next day at a sports stadium, and the story from the vegetarian restaurant you ate at, and so on, and an intimate picture of your life and interests begins to emerge over weeks and months.

The collection and preservation of stories in particular appears to defy Instagram users' expectations. People share stories with the understanding they will disappear in a day's time; instead many are being saved indefinitely by a company without their knowledge and used to profile them.

Hyp3r said that because the data it collects is already public, it does not require consent from Instagram users to harvest it, and that companies have legitimate business needs that justify knowing what is being shared from their properties.

How Hyp3r uses its data

Hyp3r has put this treasure trove of data to work in multiple ways.

First, it lets customers easily engage with users that are at their properties via the app, using its tool "Engage." It means Marriott, for example, can see every post tagged at a Marriott hotel via the Hyp3r app, including comments and likes, and respond to them where it wants to. This is not possible for apps built on Instagram's official API.

It can also target people with ads, based on their interests and the locations they've visited. Businesses can ask Hyp3r to geofence their rivals' locations, then subsequently target people who have visited those rivals with ads on Facebook.

The harvested Instagram data can also be combined with data collected elsewhere on platforms like Salesforce and Adobe — creating ever more detailed profiles about the people whose information is being scraped.

Salesforce and Adobe did not immediately respond to Business Insider's request for comment on how they vetted Hyp3r before partnering with the startup. 

Why didn't Instagram spot this?

Hyp3r has made no attempt to hide what it does.

The company's iOS App Store listing shows screenshots of an Instagram post in its app that it says it collected from a specific location — a capability that Instagram does not allow — and in its release notes from December, it references adding "support for Instagram Stories across the app."

It publicly promises its customers features that far exceed what is available through Instagram's API, saying it "surfaces all public social activity from a location — regardless of hashtags and mentions — so you never miss an opportunity to dazzle your customers." (Instagram's current API allows users to view public posts if they have been mentioned in them, or retrieve some hashtagged posts subject to stricter limitations, but not because of their location.)

However, Facebook included Hyp3r on its exclusive list of Facebook Marketing Partners — a directory of vetted companies that "can give you superior insights and data for better marketing decisions." 

A spokesperson for Instagram said the company periodically reviews Facebook Marketing Partners to ensure compliance.

Hyp3r's scraping appears to violate Instagram's rules on multiple points, including a requirement to store or cache content only "for the period necessary to provide your app's service" (Hyp3r stored user data indefinitely, according to multiple sources), and a prohibition on "reverse engineer[ing] the Instagram's APIs" (Hyp3r deliberately rebuilt its own version of an API that Instagram shuttered after Cambridge Analytica).

Similarly, Facebook's Automated Data Collection terms say: "You will not engage in Automated Data Collection without Facebook's express written permission."

Instagram also bans data from being transferred "to any ad network," but the Instagram data could be plugged into Facebook's own ads manager to target people with advertisements — meaning Facebook indirectly profited from Hyp3r's data collection. 

Hyp3r disputed that it violated Instagram's terms of service and data policies. However, an Instagram spokesperson said its practices violated the company's rules on automated data collection.

The marketing firm's behavior seems unlikely to be illegal under US law. In 2017, LinkedIn lost a legal fight against a company that had been scraping its publicly available data.

Instagram's data lapse

Hyp3r also took advantage of a lapse in Instagram's security to boost its data collection.

When accessing Instagram through a web browser, there is a publicly available JSON package that bundles up various bits of data into an easy-to-access format. It's available by simply appending a short string of characters to any Instagram URL, and you don't need to log in, gain approval, or authenticate your identity in any way to access it.

At Instagram's request, Business Insider is not sharing the exact method of accessing the package so the company has time to fix the issue.

Instagram displays public location pages, showing ordinary users posts from a given location, and this package appears on those pages. Sources said that it was through this that Hyp3r was able to scrape some of the data it was illicitly collecting on users. 

In other words: A year after Instagram disabled its location functionality for developers, the social network was still inadvertently providing an easy way for developers to keep on collecting this data, without any accountability.

The data would still have been technically possible to scrape had this JSON package not existed — but its exposure made it significantly simpler.

It's not clear why Instagram's automated tools for detecting bots on its platform failed to detect Hyp3r's mass-scale scraping.

In response to Hyp3r's actions, Instagram has made a change to prevent public location pages from being available to logged-out users.

It has also completely revoked Hyp3r's access to its APIs and removed it from the list of Facebook Marketing Partners.

An Instagram spokesperson said they couldn't yet comment on whether they would notify affected users or ask Hyp3r to formally certify that it deletes the data. The social network has formally asked Hyp3r to stop collecting Instagram data in its cease-and-desist letter, it said, and will ask it to explain itself in a phone interview and provide an account of all the data that was scraped.  

Do you work at Instagram or Hyp3r? Got a tip? Contact this reporter via encrypted messaging app Signal at +1 (650) 636-6268 using a non-work phone, email at, Telegram or WeChat at robaeprice, or Twitter DM at @robaeprice. (PR pitches by email only, please.) You can also contact Business Insider securely via SecureDrop.

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Lyft's second quarter was way better than Wall Street expected (LYFT)

Wed, 08/07/2019 - 4:38pm

Lyft on Wednesday reported second-quarter earnings that topped Wall Street's expectations, while boosting its guidance for the full year. 

Here are the important numbers:

  • Revenue: $867 million ($809 million expected)
  • Losses per share: $0.68 (adjusted) vs. $1.74 expected
  • Active riders: 21.8 million

Shares of Lyft, which went public in March, rose as much as 10% in after-hours trading following the news. 

For 2019, Lyft now expects revenues to be between $3.47 billion and $3.5 billion,  with losses shrinking by about $300 million to an $875 million maximum. 

Uber's stock price also rose about 2.5% in after-hours trading as investors digested Lyft's results as possible good news for the industry. 

"Lyft's second quarter was marked by strong execution and important advances in our product and platform," CEO Logan Green said in a press release. "This translated to record revenue driven by better than expected Active Rider growth and Revenue per Active Rider monetization."

Lyft previously said in its first-quarter earnings release, its first post-IPO, that it expects 2019 to be its worst year for financial losses. 

"We anticipate 2019 will be our peak loss year as we then move steadily towards profitably on a consolidated basis," chief financial officer Brian Roberts said at the time. 

Lyft also disclosed that some insiders, who are generally locked into holding the stock for a set period of time following an IPO, will be able to sell their shares earlier than expected. Lyft's lockup period was originally scheduled to end on September 24, the company said in a regulatory filing, but that date falls during the legally mandated quiet period ahead of its next earnings report. 

Read more: Uber and Lyft drivers reveal the scariest situations they've ever encountered

"Therefore, in accordance with the lock-up agreements with the underwriters, the lock-up period will end at the open of trading on August 19, 2019, which is ten trading days prior to the commencement of the Company's quarterly blackout period," the filing says. 

Executives will answer questions from investors and analysts on a conference call at 5 pm Eastern Wednesday to give more color to the earnings release. They'll likely have questions about Lyft's continued fight with Uber for market share, as well as bikes and scooters. 

"Key on the call will be updates on incentive spending and the competitive environment in U.S. ridesharing, with detail on market share gains," JPMorgan told clients earlier this week. "As the industry moves to a focus on product differentiation instead of price, we will look for more commentary on the impacts Lyft's recent product initiatives (matching platform, shared saver, etc.) have had on fueling growth."

Lyft does not break out data for bike and scooter rentals in its quarterly reports, but analysts will likely have questions about the company's continued investment in the programs, given that its electric bike re-launch has now been marred by fires in San Francisco.

"We remain focused on reshaping transportation and we are pleased with the continued improvement in market conditions," Green continued in the press release. "This environment along with our execution is translating to strong revenue growth and sales and marketing efficiencies. As a result of this positive momentum, we anticipate 2019 losses to be better than previously expected and we are pleased to have updated our outlook."

SEE ALSO: Uber and Lyft drivers reveal the scariest situations they've ever encountered

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Oil tumbles into a bear market as recession fears rage (WTI)

Wed, 08/07/2019 - 4:34pm

  • A surprise increase in American oil stockpiles added fuel to fears of a global recession.
  • Futures fell as much as 5.8% to a seven-month low on Wednesday, pushing the resource into bear market territory.
  • US-China trade tensions have overtaken threats of supply disruption in the Persian Gulf as the biggest headwind to oil.
  • Watch oil trade live on Markets Insider.

Trade tensions and fear of a global recession has been a drag on oil prices, even during peak season for demand. 

Futures fell as much as 5.8% Wednesday to seven-month lows after American crude stockpiles posted a surprise increase. The loss sent the resource tumbling into bear market territory. Having extra supply dilutes prices, while fears of a global recession added to worries that demand may slow.  

Global recession fears were sparked Wednesday when New Zealand, India, and Thailand all cut rates following the US's own rate cut in July. Global stocks and commodities slid in early trading while bonds and other safe-haven assets such as gold rallied. Even bitcoin rose over $12,000 briefly Wednesday, breaching the level for a second time in three days.

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US domestic crude inventories grew by 2.39 million barrels last week, ending a seven-week long stretch of declines, Bloomberg reported. Gasoline stockpiles also grew by 4.4 million barrels, which surprised the industry as it is currently peak demand season — which usually means there isn't extra gasoline to stockpile. 

Brent crude October futures lost as much as 5.2% to $55.88 a barrel, and prices have decreased more than 20% since their year-to-date peak in April. Meanwhile, US West Texas Intermediate crude futures also slid as much as 5.8% to $50.52 a barrel. 

Oil has plunged this month as trade tensions between the US and China escalated, overshadowing fears that disruptions in the Persian Gulf would be the biggest negative impact. There's increased speculation that China will start avoiding American oil as trade tension escalates, according to Bloomberg. 

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Stocks whipsaw, finish mixed amid surging global recession fears

Wed, 08/07/2019 - 4:16pm

  • Stocks bounced back from a sharp sell-0ff on Wednesday, with major indexes finishing mixed.
  • The initial losses were triggered by three central banks around the world making surprising cuts to their interest rates, raising concerns around a broad global slowdown. 
  • Meanwhile, bond prices soared, pushing the 30-year Treasury yield near all-time lows and investors also piled into havens such as gold, which reached a six-year high.
  • Stocks recovered in afternoon trading as bond yields stabilized.
  • Visit the Markets Insider homepage for more stories.

US stocks rebounded from a sharp sell-off on Wednesday sparked by three global central banks making surprising cuts to their interest rates. While that stoked concerns of a broad global slowdown, stabilizing bond yields calmed nerves in the afternoon.

The bout of risk aversion sent bond prices soaring in the morning, with the 30-year Treasury yield falling close to an all-time low. It recovered in the afternoon, returning to positive territory. Meanwhile, gold also hit a six-year high as investors sought the relative safety of haven assets.

Here's a look at the major US indexes as of the 4:00 p.m. close:

Wednesday's early-day sell-off came after Thailand, India, and New Zealand shocked investors by lowering their benchmark lending rates. Their actions further fueled a global currency war that's seen an increasing number of nations weaken their currencies. That debasement is often driven by rate cuts, since such easing increases the money supply.

Following New Zealand's rate cut, the value of the country's dollar fell, with Australia's dollar sinking to a decade-low on expectations that its central bank would follow suit and slash borrowing costs as well. 

These latest maneuverings also followed China's decision earlier this week to let its currency slip below the psychologically significant level of 7 yuan per dollar. The move was viewed as an escalation in the already fraught global trade war, since a weaker currency makes a nation's exports more appealing — and markets wound up turning in their worst day of 2019.

China stabilized its currency on Tuesday, leading to a rally in the major US indexes that pared some losses from Monday's sell-off. But investors hadn't counted on other countries getting in on the currency-devaluation trend, hence Wednesday's large losses.

President Trump also resumed his pressure on the US Federal Reserve to continuing lowering interest rates. The president wrote in a tweet  that the fed is more of threat to the US economy than China, and that the central bank needs to cut rates "bigger and faster." 

Within the S&P 500, these were the largest gainers:

And the largest decliners:

CVS health jumped as much as 5.6% after reporting second-quarter earnings that beat Wall Street estimates. The strong performance reassured investor's that the company is on track to successfully integrate its $70 billion acquisition of Aetna into its existing business. 

Shares of Disney fell as much as 5% after the media conglomerate reported second-quarter financial results that missed analysts expectations. The company attributed the rough quarter to its on-going effort to roll assets from its $71 billion purchase of 21st Century Fox into its studio entertainment segment. 

The S&P 500's rebound was led by materials, real estate, and consumer staples. Financials and energy stocks posted the only broad losses on Wednesday, dropping 1.21% and 0.76%, respectively. 

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3 private islands in Belize just hit the market — and at less than $530,000 a piece, they each cost less than the typical home in NYC and Honolulu. Here's what the money will buy you.

Wed, 08/07/2019 - 3:53pm

For those outside-of-the-box homebuyers looking to invest in an affordable private island, you're in luck.

Three private islands in Belize are currently on the market for less than $530,000 each. It's a price point that's cheaper than the median home value in some of America's major markets, including New York City, Los Angeles, and Honolulu

The three islands vary in prices ranging from $350,000 to $525,000, according to the listing website, 7th Heaven Properties.

They are located off the Caribbean coast of Southern Belize and are either undeveloped or contain a few structures that need repairs, according to Robert Cooper, the director of 7th Heaven Properties.

Read more: The Martha's Vineyard estate that Jackie Kennedy bought for $1 million in 1979 just hit the market for $65 million — here's a look inside the property

Cooper also told Business Insider that the attractive price points are due to three main factors: the islands are small in comparison to other private islands and have minimal to no developments on them; there are around 200 private islands or cayes off the Carribean coast of Belize, so there are quite a few private islands for sale; and Belize's real-estate market is less developed, especially in comparison to other countries that also have large pools of tropical islands, like the Bahamas.

Keep reading for a closer look at the three private islands.

SEE ALSO: Run-down and vacant homes in Detroit are being auctioned off for as little as $1,000. All homeowners have to do is get them into livable condition in 6 months.

DON'T MISS: A private island an hour from NYC is for sale for $13 million, and it comes with 2 homes designed by Frank Lloyd Wright and a private helipad

Belize is located in Central America and hugs the western edge of the Caribbean Sea. It sits under the US and Mexico and is around just two hours from Houston, Texas by plane.

Source: Google Maps

The largest and most expensive of the three available islands spans 1.5 acres and is located off the coast of Dangriga Town in southern Belize.

Source: 7th Heaven Properties

The 65,340-square-foot island is currently on the market for $525,000 ...

Source: 7th Heaven Properties

... and is only four miles from the Belize Barrier Reef.

Source: 7th Heaven Properties

The second-most expensive island of the three spans just over 0.65 acres and sits on Belize's Tobacco Caye Range. It's listed for $500,000.

Source: 7th Heaven Properties

There are five structures and three piers already on the island. They were built in 2009.

Source: 7th Heaven Properties

Together, the existing structures include nine bedrooms and 2.5 bathrooms. However, according to the listing website, they are in need of repairs.

Source: 7th Heaven Properties

The least expensive of the three islands spans one acre and is located seven miles off the coast of southern Belize.

Source: 7th Heaven Properties

The island is undeveloped and, as described by the listing website, is essentially a "blank canvas" for the future buyer.

Source: 7th Heaven Properties

It is on the market for $350,000.

Source: 7th Heaven Properties

However, not all of the islands for sale in southern Belize are as affordable. Just consider one 60-acre private island off the coast of Maya Beach.

Source: 7th Heaven Properties

It's the largest island in the area — and it's on the market for $12 million.

Source: 7th Heaven Properties

As for the three, smaller private islands, the affordability of their price tags comes down to three key factors. The islands' small size is working in their favor, price-wise, as is the large number of private islands for sale in Belize.

Source: 7th Heaven Properties

Thirdly, Belize's real-estate market is less developed, especially in comparison to other countries that also have large pools of tropical islands, like the Bahamas.

Source: 7th Heaven Properties

To put the three price tags into perspective, they are all more affordable than the typical home in New York City, which has a median value of $674,100 ...

Source: Zillow

... the typical home in Los Angeles, which has a median value of $688,700 ...

Source: Zillow

... and the typical home in Honolulu, which has a median value of $655,100.

Source: Zillow

We talked to 7 insiders about the $27 billion Refinitiv-LSE deal. Here’s how one of the biggest data deals of the year came together.

Wed, 08/07/2019 - 3:15pm

  • The London Stock Exchange has agreed to a $27 billion deal to buy data provider Refinitiv, just a year after the company was spun out of Thomson Reuters by private equity firm Blackstone.
  • The deal is being led by some of the biggest names in M&A in London, including Goldman Sachs, Morgan Stanley, and Evercore.
  • A media report about the deal talks triggered an scramble to get in front of the news, followed by a final sprint of negotiations and legal work, with lawyers and bankers holed up in a London law office to hammer out specifics. 
  • Conditions were less than ideal. One person said on at least two nights over a five-day period to get the deal done, a mouse was seen scampering across the law office floor. 
  • "I am taking August off," said one adviser of the deal's announcement. "I'm exhausted."
  • Click here for more BI Prime stories.

To nail down terms for the London Stock Exchange's expected $27 billion deal to buy Refinitiv, bankers and lawyers descended on the London office of global law firm Freshfields Bruckhaus Deringer — pulling all-nighters that to industry vets are a badge of honor.

And according to one person who was there, there was also an unusual guest: a mouse. On at least two separate nights, one was seen scampering across the floor of the Freshfields office, located just a few blocks from the River Thames, the person said. 

"We wondered whether this was a new M&A tactic to get us to not read the documents so closely," the person joked. 

It was in this nondescript building that attorneys, bankers and executives — exhausted from sleep-deprived nights — hammered out the final deal terms that resulted in what's likely to be one of the biggest financial technology deals of the year. When it was announced last Thursday morning, both sides shook hands with a photograph taken of dealmakers, but there was no grand celebration. Mostly, they were just happy to finally get some fresh air and reflect on the work they had done.

"I am taking August off," said one adviser of the deal's announcement. "I'm exhausted."

The deal, which had been thrown into the public spotlight earlier than some executives expected, required a deluge of work at the headquarters of Freshfields, LSE's legal advisor: namely, finalizing hundreds of pages of legal documents that covered all aspects of the deal, including its purchase and sale agreement, and working out final deal terms.

The home-stretch sprint came right after a hiccup, when news of deal talks were leaked to The Financial Times on Friday, July 26. This prompted LSE executives to hastily draw up a press release, making sure they were in compliance with UK laws requiring they inform shareholders about significant deals. 

"They had to scramble to put out a statement at 1 a.m. London time," said one person close to the deal, who characterized the leak as "not ideal."

Next, Saturday morning called for an all-hands-on-deck at Freshfields' London office, which became ground zero for final negotiations between companies as lawyers and bankers who had once worked on the deal from New York, now descended upon the British law office.

Read more: How a little-known Goldman Sachs partner took over the LSE and orchestrated an industry rattling $27 billion buyout

The stakes were clear: If successful, the deal would create a business that challenges financial data behemoth, Bloomberg. If unsuccessful, both sides would walk away with nothing more than what they started talks with. (The deal still requires antitrust approval.)

A union long in the making

That a union between the two companies was even a possibility traces back more than five years, when Refinitiv's CEO David Craig had craved for more investment in his business by its then-owner, Thomson Reuters, according to a person familiar with his thinking.

It was in 2013 that Matteo Canonaco, a co-founder of Canson Capital Partners who socialized with Craig, learned of this and thought Refinitiv would be a good candidate for a leveraged buyout, according to this person. He acted on the information and introduced Craig to Joseph Barratta, global head of private equity at Blackstone, as it was reported by Reuters.

Discussions with Barratta led Blackstone to take a look at Refinitiv, this person said. But the private equity giant couldn't make the math work at the time, according to an account of the deal on a podcast published by Blackstone.

The firm revisited the idea in 2016 and Blackstone's senior managing director, Martin Brand, took over the deal and developed a plan to carve Refinitiv out of Thomson Reuters.

About 15 to 20 meetings developing the thesis behind such a deal proved fruitful, according to the Blackstone podcast. After months of negotiations with Thomson Reuters, the two sides settled on a corporate partnership, where Thomson Reuters would remain a large investor but cede control to Blackstone. Blackstone bought Refinitiv for $20 billion to own 55 percent alongside other investors, while Thomson Reuters owned 45 percent.

The stars align for LSE

After the deal was completed in October 2018, Blackstone immediately began making changes to Refinitiv, working closely with its management.

This included announcing the simultaneous layoff of 2,000 employees, and the hiring of 1,000, to save $650 million. Blackstone also took public an electronic trading platform that Refinitiv owned, called Tradeweb Markets, raising $1.1 billion in April.

The same month, news surfaced that Deutsche Boerse was in talks to buy some of Refinitiv's foreign exchange business— a development that did not go unnoticed by the newly appointed CEO of the London Stock Exchange.

LSE CEO David Schwimmer, who had just joined the British exchange operator from Goldman Sachs, already knew Blackstone from having worked with the firm at Goldman.

In fact, as one of his last acts at Goldman Sachs before joining LSE, Schwimmer had helped sell a company that Blackstone and Goldman jointly owned. The company was Ipreo, another financial data provider, which announced its sale to information analytics company IHS Markit in May.

Brand, Blackstone's lead on Refinitiv, had worked on the Ipreo deal, though he never met Schwimmer in person during the matter, said people familiar with their relationship.

Still, Brand came away with an overall positive impression of Schwimmer. Based on conference calls and other communications, Schwimmer struck Brand as smart, humble and strategic.

Read more:LSE's $27 billion bid for Refinitiv highlights how hungry exchanges are for data. Industry insiders say FactSet could be the next target.

Sometime after Schwimmer settled into his new job at LSE in the summer of 2018, Brand and Schwimmer spoke about Refinitiv, though LSE had already taken a look at the company in the past, at least considering a potential partnership, said a person with direct knowledge of the matter. However, the pace of conversations sped up once news of a possible sale to Deutsche Boerse surfaced.

It was believed that the FX side of the business fit better with LSE, so Blackstone slowed negotiations with the German exchange, which in turn gave discussions with LSE a boost in momentum. One adviser described the situation as an "alignment of stars" whereby LSE's share price continued to rise and counterparties began to see the strategic value of a merger.

It took more than three months before news of merger talks leaked to the Financial Times. By that point, the deal was in its final stages, but terms were being worked out all the way through to the day before the transaction was announced, according to people familiar with the matter.

Dealmakers assemble

In the days leading up to the deal's announcement, Freshfields' London office served as a revolving door of Refinitiv and LSE executives, flanked by some of the most influential and expensive dealmakers who joined meetings in and out of the law office.

Within the office, Refinitiv camped out on its sixth floor, while LSE took the fifth. Law firm Simpson Thacher & Bartlett, which represented Refinitiv, and Freshfields, which represented LSE, drafted up paperwork as negotiations neared the finish line.

Bankers were on scene as well, including some of the biggest names in M&A.

Jane Gladstone, a top M&A banker at Evercore, had flown in from New York overnight after news of the deal talks hit the press Friday. She and a team of bankers advising Refinitiv joined attorneys at Simpson Thacher, including partner Elizabeth Cooper, to bring the deal to the finish line.

The exact terms being negotiated in the final stretch could not be determined. One adviser said they focused on governance issues related to board seats and investor rights, although this was disputed by another advisor who refused to provide details about what was actually discussed.

Gladstone is well-known in M&A circles, especially for her financial technology work. Last year, she advised NEX Group on its $5.7 billion sale to CME Group. She was one of eight women out of the 49 people recognized in Institutional Investor's annual ranking of financial technology deal makers.

Also there was Canonaco, the banker who introduced Refinitiv to Blackstone who also had a big reason to see the deal to fruition: He, along with his colleague James Simpson who co-founded boutique Canson Capital Partners, had not just advised Refinitiv, but also raised more than $100 million to invest in the company.

On LSE's side, there was general counsel Catherine Johnson who was on-scene, as well as Paul Carter, group head of corporate development.

Bankers for the exchange who were said to be involved in meetings leading up to the deal's announcement but whose location could not be verified were Mark Sorrell, a UK-based M&A executive at Goldman Sachs, as well as Morgan Stanley's Matthew Jarman, the lead banker who advised Intercontinental Exchange in a bid for the London Stock Exchange in 2016.

Late-night negotiations

As late as Wednesday, there were still meaningful topics being worked out between sides, said two people familiar with the matter, but advisors stayed through the night and produced signatures at 6:55am on Thursday.

The London Stock Exchange had offered $27 billion for Refinitiv in a deal that placed Blackstone and Thomson Reuters as the largest shareholders in LSE, together owning 37 percent of its shares and controlling just under 30 percent of its voting rights.

One person involved said that both sides were "equally unhappy and equally happy" and described the final terms as "hard-negotiated."

On news of the deal's agreement, London Stock Exchange shares rose in a sign that shareholders approved of the transaction.

People with direct knowledge of the deal said Blackstone did not hardball LSE on the offer price so that the public markets would welcome the deal and LSE's share price would tick up.

A big win for Blackstone

The deal was viewed as a big win for Blackstone, which appeared set to double its money just 10 months after it bought Refinitiv. The private equity group, along with the Canada Pension Plan Investment Board and Singapore's GIC, put $4 billion in the form of equity and preferred debt into a 55% stake in Refinitiv last year which now reflects around $8 billion in common equity as of last Friday.

However, Blackstone and minority investors agreed to a lock-up period of two years, after which they will be progressively allowed to sell their stakes over a three-year period.

Because of this, they will have to wait out a return on the investment as Refinitiv is controlled by the London Stock Exchange.

Blackstone will have two board seats while Thomson Reuters will have one. People close to the deal remarked how Blackstone's minority ownership position -- somewhat unusual for a private equity firm -- reflected a vote of confidence in Refinitiv and LSE's prospects.

On a personal level, Brand, the Blackstone lead, had viewed the deal as one of the biggest opportunities in his career. Seen as "straight in style" throughout negotiations, he was thought to have worn the same suit throughout the five-day sprint, all the way until he posed for a picture with an LSE executive last Thursday. 

"It was pretty intense," said the person who was there. "[We] were there non-stop."

SEE ALSO: Meet the bankers pulling together LSE’s industry-changing $27 billion deal for Refinitiv

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