US Treasury Secretary Sheds Light on Libra Mass Exit as Facebook Faces Lawsuit

US Treasury Secretary Sheds Light on Libra Mass Exit as Facebook Faces Lawsuit

The United States Treasury Secretary, Steven Mnuchin, recently shed some light on the highly publicized mass exit from the Libra Association last week. This comes as Facebook is also facing a Libra-related lawsuit against its Calibra organization.

Treasury Secretary Steve Mnuchin says Libra exit was due to compliance issues

First and foremost, Mnuchin’s comments came during a fresh appearance by the Treasury Secretary on CNBC’s Squawk Box segment. In the interview, Mnuchin said that companies are now abandoning Facebook’s Libra Association for a very particular reason.

According to Mnuchin, this is because the Libra project is supposedly not “up to par” with American anti-money laundering (AML) standards and regulations. 

“If they don’t meet the standards of our money-laundering standards and the standards that we have at FinCEN, we would take enforcement actions against them. I think they realized that they are not ready, they are not up to par and I assume some of the partners got concerned and dropped out until they meet those standards.”

This is a reason which has been floated by several commentators before, but hearing it directly from the US Treasury Secretary does lend it further credence. Mnuchin said that this could have made made some partners drop out early – just like Toshi Times reported in earlier coverage of the growing Libra debacle.

Libra Association crumbling before Facebook’s eyes?

This is, however, only the tip of the iceberg. So far, Visa, Mastercard, PayPal, Stripe, eBay and Mercado Pago have all left the Libra Association

Furthermore, in breaking news Booking Holdings has also just left the Libra Association. Booking Holdings is the parent company to booking.com, priceline.com, agora.com and Kayak. This is all if a fresh Bloomberg report is to be believed. The fresh report also states that the Libra Association has now only got 21 of its 28 founding members left.

Nevertheless, this is not the only worry that Facebook is seeing in relation to Libra. Calibra, the Facebook subsidiary which should oversee Libra, is now facing a lawsuit from the mobile banking application Current.

Specifically, Calibra is being sued for trademark infringement. The reason for this is supposedly because Calibra’s logo is said to be “confusingly similar” to Current’s logo. The two logos are undoubtedly very similar, but there is even more to this story.

Image Source: Twitter

Both logo designs come from the San Francisco-based branding firm Character. As such, it is unclear whether this is the result of a deliberate reuse of the logo from Character’s part. Either way, it will be interesting to see how this story resolves itself.