The tech industry has seen its fair share of scandals and controversies over the years. These are some of the biggest tech scandals, scandals that led to bankruptcy, imprisonment, and the expected tarnished reputation.
1. 1985-1987 The Therac-25 Radiation Overdose Incidents
In the 1980s, the Therac-25 radiation therapy machine, used for cancer treatment, caused several incidents of radiation overdoses. Due to software and hardware errors, patients received extremely high radiation doses, leading to injuries and deaths.
2. 2000 WorldCom
WorldCom, a telecommunications company, was involved in a massive accounting scandal. It was discovered that the company had engaged in fraudulent accounting practices, inflating its earnings by over $11 billion. WorldCom’s executives had manipulated financial statements to deceive investors and maintain the appearance of profitability.
3. 2001 Enron Accounting Scandal
It all was made public after a whistleblower letter from Enron’s Vice President Sherron Watkins to Ken Lay, the Chairman. Apparently they committed accounting fraud, hiding losses in order to inflate its financial results. The company went belly up in 2004 when they ended their bankruptcy.
4. 2005 Sony Rootkit
Sony BMG, the music division of Sony Corporation, distributed music CDs with hidden digital rights management (DRM) software. This software included a rootkit, which raised privacy and security concerns. Sony faced backlash, lawsuits, and recalls as a result. The incident highlighted the risks of DRM technology and the importance of user privacy and transparency.
5. 2006 The murder of Nina Reiser
Nina Reiser, a Russian-born American woman, was murdered in Oakland, California. Her husband, Hans Reiser, a prominent computer programmer, was convicted of first-degree murder and sentenced to 15 years to life in prison.
6. 2006 HP Spying Scandal
HP was involved in a spying scandal where they conducted illegal investigations and engaged in unethical practices to identify boardroom leaks by hiring private detectives to spy on their own employees. The scandal resulted in criminal charges, lawsuits, and significant reputational damage for HP.
7. 2006 AT & T Whistleblower
One of the largest telecommunications companies in the U.S. faced controversy over its involvement in a surveillance program known as “Room 641A.” It was revealed that AT&T had allowed the National Security Agency (NSA) access to its telecommunications network, enabling the collection of customer data without proper legal authorization.
8. 2010 Foxconn Suicides
More than twelve workers commit suicide as a result of harsh working conditions in a Chinese factory that manufactures iPhones, iPads, and HP computers.
9. 2013 Snowden Leaks
Confidential documents leaked by Edward Snowden reveal that the NSA has been secretly accessing servers of Google and Yahoo.
10. 2013 Yahoo Data Breaches
Yahoo experienced two major data breaches, one in 2013 and another in 2014, with billions of user accounts affected. This compromised everything that was related to an Yahoo account, from personal information, including names, email addresses, and phone numbers, to encrypted passwords.
11. 2014 Facebook Emotional Contagion Experiment
Facebook faced backlash when it was revealed that they conducted a large-scale experiment on user emotions without explicit consent. For example, they bombarded the news feed with mostly negative or mostly positive news to see if they could get a reaction from the user.
12. 2015 Volkswagen Emissions Scandal
Ah, Dieselgate! Volkswagen was shown to have installed software in their diesel vehicles to cheat emissions tests. The scandal involved millions of affected vehicles worldwide and resulted in legal consequences, fines, and a significant blow to the company’s reputation.
13. 2015 Theranos Scandal
Theranos was a biomedical company founded by Elizabeth Holmes that promised to revolutionize blood testing. The scandal involved allegations of fraud, misleading investors, and false claims about the capabilities of their products. She is currently serving a 11-year term for defrauding investors.
14. 2015 Ashley Madison Data Breach
Ashley Madison, a dating service with the motto “Life is short. Have an affair.” suffered a data breach. The personal information of millions of users was exposed, causing embarrassment and potential harm to those involved.
15. 2016 Apple EU Tax Saga
Apple is instructed to pay €13 billion in back taxes to the EU after Ireland’s tax breaks, which the company had benefited from, are deemed illegal.
16. 2016 Samsung Galaxy Note 7 Recall
People were super pumped to get their hands on the latest Note, Note 7, only to go home and be one unlucky ones and see it catching fire. The crisis was huge and it led to a global recall of 2 million devices, which resulted in a $5.3 billion loss and a blow to its reputation.
17. 2016 Yahoo Email Surveillance
Another gem from the Yahoo giant, this time on behalf of the U.S. government. Some of the guys developed a custom software program to scan its users’ emails. Granted, they claimed all they did was to scan emails for spam, child pornography and malware but this doesn’t make it ok.
18. 2016 Cryptoqueen Scandal
Ruja Ignatova launched a cryptocurrency called OneCoin and marketed it as a revolutionary investment opportunity. However, it turned out to be a massive Ponzi scheme. Ignatova disappeared in 2017, and investigations revealed that OneCoin had defrauded billions of dollars from investors worldwide.
19. 2017 Equifax Data Breach
Equifax, one of the largest credit reporting agencies in the U.S, had a huge data breach which meant the personal information of approximately 147 million consumers was out in the open.
20. 2017 Juicero Juice-Pressing Device
Juicero, a company that developed a high-priced juicer, faced ridicule and controversy. It was discovered that the juicer’s expensive price tag was unjustified, as the juice packets it squeezed could be manually pressed by hand, rendering the machine unnecessary.
21. 2017 Uber-Waymo Trade Secret Lawsuit
Waymo, the self-driving car division of Google’s parent company Alphabet, filed a lawsuit against Uber, accusing it of stealing trade secrets related to autonomous vehicle technology. Asked damages of up to $1.8 billion, settled for around $244 million and stopped Uber from using any of its technology.
22. 2017 Uber’s Toxic Workplace Culture
Uber is not exactly known for being a company that takes pride in its workplace culture. In fact, quite the opposite. So when allegations of sexual harassment, discrimination, and a toxic work environment surfaced in 2017, no one was shocked. Appalled, yes, but not surprised. Several high-ranking resignations later, the whole thing was done and buried.
23. 2018 Cambridge Analytica and Facebook
Or the time we all found out that Cambridge Analytica, a political consulting firm, obtained and used personal data from millions of Facebook users, all this happening without their consent. This data was allegedly used to influence political campaigns, leading to concerns about privacy, data misuse, and Facebook’s handling of user information.
24. 2018 Andy Rubin Scandal
Google grapples with internal issues following reports of sexual misconduct within the company, involving high-ranking executive Andy Rubin.
25. 2019 WeWork Implosion
WeWork’s flawed business model and management concerns result in a failed initial public offering (IPO), the removal of the CEO, and a considerable decline in valuation.
26. 2019 Blood-Testing Startup uBiome Fraud
uBiome, a biotech startup, was investigated for fraudulent billing practices and misleading customers. The company allegedly billed insurance providers excessively for unnecessary tests and misled patients about the accuracy and necessity of their tests.
27. 2019 Surprise Mechanics EA Scandal
EA faced controversy over “Surprise Mechanics” in their games, particularly loot boxes. Loot boxes, which players could purchase with real or in-game currency, contained randomized items. Critics argued that they resembled gambling, leading to addiction concerns. Some countries classified loot boxes as gambling, resulting in legal challenges for EA.
28. 2020 Nikola Motors Deception
Nikola Motors, an electric truck startup, faced controversy in 2020 when it was revealed that they misled investors and the public about the capabilities of their electric vehicles. Overhyping your product will get you more investors, more cash and a better position in the market but you could also be left to pay hundreds of millions like in this case.
29. 2023 Xbox Acquiring Activision
Xbox just acquired Activision (they’re in the process of doing so but all things point to it going through), a major video game publisher known for franchises like “Call of Duty” and “Diablo.” This consolidation strengthened Xbox’s position in the gaming industry, expanded their game library, and sparked discussions about industry consolidation and competition.
The focus point of some of the biggest tech scandals was, drumroll, the thirst for personal financial gain, for a better market share, for more and more MONEY. From data breaches and privacy violations to corporate misconduct and manipulation, these scandals have underscored the importance of ethical practices, transparency, and the need for tough regulations in the ever-evolving tech landscape.
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