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I have been hacked but how???

Well it's jailbroken, that opens up a whole new world and become vulnerable to these things, he could've used exploits through Mobile Terminal or maybe a program through his computer, but I've never heard of someone hacking into their iPhone and do something like that!
How do you know he can see you in the front camera?
And has your friend have any access to your phone?
Look, if you are wondering what program he is using (assuming he really did get you) go do what a user suggested already. Check SBSettings, go to more, then click on mobile substrate addons. Post that list.

After that, go to Cydia -> manage -> packages.
See if there is anything suspicious there.

I have an idea for a iphone rat I want to make. I just have to get the time to develop it. But not going to be soon at all so don't get your hopes up yet.