The US Federal Trade Commission (FTC) is investigating Facebook's privacy practices following a week of scandals including allegations a Trump-affiliated political consulting firm obtained data inappropriately from millions of the social network's users.
Facebook's stock, which already took a big hit last week, plunged as a result.
The social media giant said the company remains "strongly committed" to protecting people's information and that it welcomes the opportunity to answer the FTC's questions.
Meanwhile, the chief law enforcement officers for 37 US states and territories are demanding to know when Facebook learned of the breach.
The officers say in a letter to Facebook CEO Mark Zuckerberg that users' trust in the social media platform is "broken".
The attorneys general are asking how Facebook monitored what these developers did with all the data they collected and whether Facebook had safeguards to prevent misuse. They also asked Mr Zuckerberg for an update on how Facebook will allow users to more easily control the privacy of their accounts.
Cambridge Analytica, a political data-mining firm, is accused of lifting data from some 50 million Facebook users to influence voters in the 2016 election which saw Donald Trump win the US presidency.
News outlets reported on the FTC investigation last week, but the FTC had not confirmed it until Monday. Facebook reached a settlement with the FTC in 2011 offering privacy assurances.
The social networking firm's privacy practices have come under fire after revelations that Cambridge Analytica obtained data on Facebook users, including information on friends of people who had downloaded a psychological quiz app, even though those friends had not given explicit consent on sharing.
Facebook is also facing questions over reports that it collected years of data on contact names, telephone numbers, call lengths and information about text messages from Android users.
Company officials said on Sunday that this information is uploaded to secure servers and comes only from people who gave explicit consent to allow it.
They added that the data is not sold or shared with users' friends or outside apps. They say the data is used "to improve people's experience across Facebook" by helping to connect with others. But the company did not spell out exactly what it used the data for or why it needed it.
Marc Rotenberg, executive director of the Electronic Privacy Information Centre, believes Facebook was in violation of the 2011 settlement in letting Cambridge Analytica harvest data on friends of Facebook users.
He said: "This is what Facebook was doing 10 years ago that people objected to, what the FTC should have stopped in 2011.
"It makes zero sense that when a person downloads their apps, they have the ability to transfer the data of their friends."
Although Mr Zuckerberg talked about changes in 2014 that would have prevented this, Mr Rotenberg said it should have been banned already under the 2011 consent decree. He said the FTC had dropped the ball in failing to enforce that.