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Kashmir Hill, reporting for Gizmodo:

Last week, I ran an ad on Facebook targeted at a computer science professor named Alan Mislove. Mislove studies how privacy works on social networks and had a theory that Facebook is letting advertisers reach users with contact information collected in surprising ways. I was helping him test the theory by targeting him in a way Facebook had previously told me wouldn’t work. I directed the ad to display to a Facebook account connected to the landline number for Alan Mislove’s office, a number Mislove has never provided to Facebook. He saw the ad within hours.

One of the many ways that ads get in front of your eyeballs on Facebook and Instagram is that the social networking giant lets an advertiser upload a list of phone numbers or email addresses it has on file; it will then put an ad in front of accounts associated with that contact information. A clothing retailer can put an ad for a dress in the Instagram feeds of women who have purchased from them before, a politician can place Facebook ads in front of anyone on his mailing list, or a casino can offer deals to the email addresses of people suspected of having a gambling addiction. Facebook calls this a “custom audience.” You might assume that you could go to your Facebook profile and look at your “contact and basic info” page to see what email addresses and phone numbers are associated with your account, and thus what advertisers can use to target you. But as is so often the case with this highly efficient data-miner posing as a way to keep in contact with your friends, it’s going about it in a less transparent and more invasive way.

… Giridhari Venkatadri, Piotr Sapiezynski, and Alan Mislove of Northeastern University, along with Elena Lucherini of Princeton University, did a series of tests that involved handing contact information over to Facebook for a group of test accounts in different ways and then seeing whether that information could be used by an advertiser. They came up with a novel way to detect whether that information became available to advertisers by looking at the stats provided by Facebook about the size of an audience after contact information is uploaded. They go into this in greater length and technical detail in their paper [PDF]. They found that when a user gives Facebook a phone number for two-factor authentication or in order to receive alerts about new log-ins to a user’s account, that phone number became targetable by an advertiser within a couple of weeks.

Officially, Facebook denies the existence of shadow profiles. In a hearing with the House Energy & Commerce Committee earlier this year, when New Mexico Representative Ben Lujan asked Facebook CEO Mark Zuckerberg if he was aware of the so-called practice of building “shadow profiles”, Zuckerberg denied knowledge of it.