American provider for remote video conferencing services Zoom Video Communications Inc. (ZM) has been sued by its shareholders for failing to reveal that its Zoom app doesn’t support end- to-end encryption and exaggerating its privacy standards.
Since the platform lacks end-to-end encryption, this means the company has the ability to access on going session by its users.
In the court filing made by Michael Drieu, a shareholder in the company, stock of the company has plunged deep following recent stories which have been featuring across all media platforms concerning the company’s flaws on data security.
In the first three months of the year, the stock was on a constant rallying spree leading to an all time high, however barely a week after the data security reports started making rounds in the internet the stock has since plunged by over 30%.
In the past week CEO of Zoom, Eric Yuan issued a public apology to users the platform expressing his regrets on how the company had fallen short of the community’s privacy and security standards.
He however attributed the security concerns to a rapid spike in the number of users accessing the platform brought about by the current corona situation forcing individuals to work from home. In the Month of March 200 million users used the Zoom app, its highest number of users in a single month ever.
Zoom Hires Ex Facebook Data Security Expert
In other news about the company, Zoom hired former head of data security at Facebook Inc. (FB) Alex Stamos to help them address the fast growing data security concerns before things get out of hand.
It all started Stamos being at the accusing end of the issue whereby he dared the company to me more transparent with data issues include rolling out a 30-day security plan. He was using his Twitter account to pass across his message then CEO Yuan used the same portfolio inviting him to provide his input as an external consultant.
“Zoom has some important work to do in core application security, cryptographic design and infrastructure security, and I’m looking forward to working with Zoom’s engineering teams on those projects,” posted Stamos.