Passwords of millions of Facebook, Instagram users exposed - Stored in readable format

Facebook Inc said on Thursday it has resolved a malfunction that exposed passwords of millions of users stored in “readable” format (Plain Text) within its internal systems to its employees.

The passwords were accessible to as many as 20,000 Facebook employees and dated back as early as 2012, cyber security blog KrebsOnSecurity, which first reported the issue, said in its report.

“These passwords were never visible to anyone outside of Facebook and we have found no evidence to date that anyone internally abused or improperly accessed them,” the company said.

KrebsOnSecurity, citing a senior Facebook employee, said an internal investigation by the company so far indicates that between 200 million and 600 million Facebook users may have had their account passwords stored in plain text.

Facebook said the issue was discovered in January as part of a routine security review. A majority of the affected were users of Facebook Lite, a version of the social media app largely used by people in regions with lower connectivity.

The social network is also probing the causes of a series of security failures, in which employees built applications that logged unencrypted password data for Facebook users, the report said.

“We estimate that we will notify hundreds of millions of Facebook Lite users, tens of millions of other Facebook users, and tens of thousands of Instagram users,” the company said on the report.

"We have fixed these issues and as a precaution will be notifying everyone whose passwords we found stored this way," wrote Pedro Canahuati, VP Engineering, Security and Privacy at Facebook.

"Consider enabling a security key or two-factor authentication to protect your Facebook account using codes from a third party authentication app. When you log in with your password, we will ask for a security code or to tap your security key to verify that it is you," Facebook advised.