13/Jul/2019
America’s Federal Trade Commission (FTC) has reportedly voted to approve fining Facebook roughly $5bn (£3.9bn) to settle an investigation into the company’s privacy violations that was launched following the Cambridge Analytica revelations.
On Friday afternoon, The Wall Street Journal and the Washington Post, both citing anonymous sources familiar with the matter, reported that the settlement was approved by a 3-2 vote that was split along party lines, with Republicans in favour and Democrats opposed. The justice department is expected make a final approval of the fine.
The FTC’s investigation was launched in March 2018 after the Observer newspaper revealed that political consultancy Cambridge Analytica had improperly obtained the private information of more than 50 million Facebook users. Under a 2012 consent decree stemming from a previous FTC investigation into privacy concerns, Facebook had agreed to better protect user privacy. The investigation centred on whether this decree had been violated.
The $5bn fine would be the largest ever levied by the FTC against a technology company, and the largest ever against any company for a privacy violation. It is at the upper limit of what Facebook said that it was expecting when, in April, it disclosed that it was nearing the end of negotiations with the FTC. It expected a fine of between $3bn (£2.4bn) and $5bn (£3.9bn).
As part of the agreement, Facebook will now reexamine the ways it handles user data, but the settlement will not restrict the company’s ability to share data with third parties, reports said.
Critics say the changes required of Facebook are not substantial enough, and the fine will hardly make a dent in Facebook’s finances: in the first quarter of 2019, the company’s revenues exceeded $15bn (£11.7bn). Investors appeared to agree: Facebook’s stock price jumped more than 1% when the news broke just before trading closed for the weekend.
For more on this story, take a look at the Guardian’s report.
