The social media colossus has reacted to a report saying it is seeking data from banks about clients.

(An earlier version of this news item appeared yesterday on Family Wealth Report,sister news service to this one; it is updated with the Facebook statement.)

Facebook has responded to a media report that claimed it has asked large US banks such as Wells Fargo, JP Morgan, Citigroup and US Bancorp to share detailed financial information about clients as part of a push to offer new services to users. 

The Wall Street Journal said Facebook increasingly wants to be a platform where people buy and sell goods and services. The news service quoted unnamed sources. 

The social media firm has denied the claim, saying the report was inaccurate.

“A recent Wall Street Journal story implies incorrectly that we are actively asking financial services companies for financial transaction data – this is not true. Like many online companies with commerce businesses, we partner with banks and credit card companies to offer services like customer chat or account management," a spokesperson for Facebook told Family Wealth Report in an emailed statement today.

"The idea is that messaging with a bank can be better than waiting on hold over the phone - and it's completely opt-in. We're not using this information beyond enabling these types of experiences – not for advertising or anything else. A critical part of these partnerships is keeping people's information safe and secure," the spokesperson said. 

While the WSJ report did not go into specifics about wealth management, it should be noted that large banks routinely have such operations and high net worth clients’ privacy is typically a key concern. Citi and Wells Fargo, for example, serve high net worth and UHNW individuals.

Facebook, which had suffered a sharp fall in its stock market price a few days ago amid concerns about its earnings, faces controversy from its ties to the political analytics firm Cambridge Analytica, which had access up to 87 million Facebook users without their consent. (See this item for a recent commentary about such Big Techs, the "FAANGs".)

The story also shows how Big Tech firms such as Facebook, Google and Amazon have been seen as trying to camp on banks’ traditional turf, challenging established financial models and possibly injecting fresh competition. On the other hand, political anger about Facebook’s saga over Cambridge Analytica and claims that such Silicon Valley firms tend to have a liberal-left bias in corporate governance strategy, has raised the risk that they could come in for the kind of anti-trust action that hit Microsoft, for example, over a decade ago. In the European Union, the 28-state bloc in July slapped a record $5 billion fine on search-engine giant Google for breaching competition laws. 

Facebook has talked about a feature that would show its users their checking-account balances, the WSJ quoted its sources as saying. Data privacy is a sticking point in the banks’ conversations with Facebook.

One large US bank – which the WSJ didn’t identify - pulled away from talks due to privacy concerns.

At a FWR conference in New York City about two years ago, one executive from the family offices industry was asked his advice on quick steps to protect privacy. The reply was "take down your Facebook account".