US stock indexes tumbled in afternoon trading on Monday, as a sharp drop in Facebook dragged technology companies down.

The social media company is facing new criticism related to privacy issues following reports that a data mining firm working for the Trump campaign improperly obtained and then kept data on tens of millions of users. The stock is on pace for its biggest loss in four years.

A former employee of a Trump-affiliated data-mining firm says it used algorithms that "took fake news to the next level" using data inappropriately obtained from Facebook.

Chris Wylie says the firm, Cambridge Analytica, secured personal data in order to learn about individuals and then used it to create an information cocoon to change their perceptions.

He says the firm used "informational dominance" to capture every channel of information around a person to surround them with curated information, changing their perception of what's actually happening.

In an interview Monday on NBC's "Today," Wylie said Cambridge Analytica aimed to "explore mental vulnerabilities of people.

While Wylie said he doesn't know to what extent Trump's campaign used the techniques, he said Trump's former campaign manager Corey Lewandowski was meeting with Cambridge Analytica in 2015, before Trump even announced his run for office.

Facebook suspended the company from using its services Friday, hours before the reports came out.

In total, Cambridge Analytica earned more than $16 million from 2014 to 2016 from nearly 20 Republican candidates and political committees.

 

The S&P 500 index sank 46 points, or 1.7 percent, to 2,705 as of 1:45 p.m. Eastern time. The benchmark index is on track for its biggest loss since February 8 when it tumbled almost 4 percent.

The Dow Jones industrial average fell 450 points, or 1.7 percent to 24,547.

The Nasdaq composite gave up 169 points, or 2.3 percent, to 7,313. The Russell 2000 index of smaller-company stocks declined 26 points, or 1.7 percent, to 1,559.

Overall, the tech-heavy Nasdaq dropped as much as 2.5 percent. Google parent Alphabet was down 3 percent, while Netflix and retail giant Amazon declined by more than 2 percent.

Facebook fell as much as 8.1 percent to $170.06 on Monday in New York, wiping out all of the year's gains so far. That marked the biggest intraday drop since August 2015.

Facebook said Friday that the data mining company Cambridge Analytica improperly obtained data on some of its users, and that it had suspended Cambridge while it investigates. Facebook said the company obtained data from 270,000 people who downloaded a purported research app that was described as a personality test.

The New York Times and the Guardian reported that Cambridge was able to tap the profiles of more than 50 million Facebook users without their permission. Facebook first learned of the breach more than two years ago but hadn't disclosed it. A British legislator said Facebook had misled officials while Senator Amy Klobuchar of Minnesota said Facebook CEO Mark Zuckerberg should testify before the Senate Judiciary Committee.

Other technology companies also struggled. Microsoft slid $2.16, or 2.3 percent, to $92.45 and Apple fell $3.64, or 2 percent, to $174.38. Health care and energy companies also fell, as did consumer-focused companies like retailers.

Daniel Ives, chief strategy officer and head of technology research for GBH Insights, said this is a crisis for Facebook, and it will have to work hard to reassure users, investors and governments.

"This is a defining moment for them," he said. "It either becomes a blip on the radar and it helps the platform mature... or it becomes the start of something broader."

Ives said Wall Street is more concerned about the latest situation than it was about issues like Facebook's platform spreading fake news. That's because Cambridge reportedly got access to the personal data of a large number of users, and the backlash suggests Facebook may face more regulation or could lose users, advertisers or advertising revenue.

He estimated that $5 billion in annual revenue for Facebook might be at risk and that the company has to work hard to assure users and government agencies. He said the situation could create problems for other tech companies, especially Twitter and Alphabet's YouTube unit.

- Associated Press