OK, after signing out of Facebook and signing in again the problem is worse (this fixed a similar issue during the 3.5.2 betas) now I cannot sign in at all.
Ready to connect:
Press OK here:
Oooops something is broken here:
After giving on up that installation I deleted Waze, signed out of Facebook and signed back in again and reinstalled Waze. Now I have two friends ...
Here's all my Facebook/Waze friends from the scoreboard:
I would go back to v3.5.2 and see what gives but since it only lasted a few days I hadn't synced to my PC so don't have a copy.