Facebook have to pay $5 billion to the US Federal Trade Commission as fine for users’ privacy violations. Read on to more about it…
Facebook is set to pay $5 billion to the US Federal Trade Commission (FTC) this week as fine for the violation of users’ privacy in the Cambridge Analytica data breach involving 87 million users. Recently, FTC commissioners voted by 3-2 with Republicans in support and Democrats in opposition to the penalty on Facebook.
The FTC initiated the investigation after a scandal involving former British consulting firm Cambridge Analytica, which was accused of illegally accessing data of more than 87 million Facebook users without their prior knowledge. The FTC investigated whether Facebook’s data sharing with the British firm violated a 2011 consent agreement signed between Facebook and the regulator.
In the agreement filed, the FTC alleges that Facebook violated the law by failing to protect data from third parties, serving ads through the use of phone numbers provided for security, and lying to users that its facial recognition software was turned off by default.
As part of the settlement, Facebook will agree to create a board committee on privacy and will agree to new executive certifications that users’ privacy is being properly protected. It is still unclear what the restrictions are on Facebook’s handling of user privacy in the settlement. FTC and Facebook declined to comment on the story. But Facebook said in April that it expected to pay up to $5 billion to settle the probe.
The Wall Street Journal reported the U.S. Securities and Exchange Commission (SEC) settlement earlier stating that — separately, SEC is expected to announce a related settlement with Facebook for around $100 million over allegations it failed to disclose risks to investors over its privacy practices.
The settlement comes amid growing concern among U.S. policymakers about the privacy of online users and have sparked calls for new legal protections in Congress. The FTC will not require Facebook to admit guilt as part of the settlement. The settlement will need to be approved by a federal judge and will contain other significant allegations of privacy lapses, the people said. This fine will mark the largest civil penalty ever paid to the FTC.
It was reported that Facebook Chief Executive Mark Zuckerberg will have to certify every three months that the company is properly safeguarding user privacy. Apart from the 5 Billion-dollar fine, Facebook will be required to conduct a privacy review of every new product or service that it develops, and these reviews must be submitted to the CEO and a third-party assessor every quarter. As it directly relates to Cambridge Analytica, Facebook will now be required to obtain purpose and use certifications from apps and third-party developers that want to use Facebook user data. However, there are no limits on what data access the company can authorize to those groups once the disclosure is made.
Other Privacy Violations
There have been several incidents after the Cambridge Analytica episode where Facebook acknowledged series of privacy lapses, including the latest admission that it mishandled millions of users’ passwords on Instagram and “unintentionally” uploaded emails of nearly 1.5 million of its new users.
Currently, Facebook is also facing public criticism from President Donald Trump and others about its planned cryptocurrency Libra over concerns about privacy and money laundering.