In an amazing turn of events, Facebook Inc will be forced to pay a record-breaking $5 billion fine due to the outcome of the US governments probe into Facebook’s privacy practices. As part of the FTC settlement, Facebook will also build new tools and help implement safeguards for user’s data.
The FTC settlement is made up of:
* $5 billion fine
* Requiring Facebook’s board to create a new committee to monitor privacy practices
* Requires Facebook to report to the FTC when data of 500 or more users is compromised
* Orders quarterly certifications from Facebook CEO Mark Zuckerberg and compliance officers
The FTC probe, which was triggered last year by allegations that Facebook that Facebook violated a 2012 consent decree by inappropriately sharing information belonging to 87 million users with the now-defunct British political consulting firm Cambridge Analytica, uncovered a wide range of privacy issues as part of its investigation. Cambridge Analytica clients included non-other than President Donald Trump’s 2016 election campaign.
Republican FTC Chairman Joe Simons stressed that the FTC’s limited authority and desire to avoid a long court fight.
“Would it have been nice to get more, to get $10 billion, instead of $5 billion for example, to get greater restrictions on how Facebook collects uses and shares data?” he asked at a press conference. “We did not have those options. We cannot impose such things by our own fiat.”
Democratic FTC Commissioner Rohit Chopra complained that the penalty to Facebook provided “blanket immunity” for all Facebook executives” and no real restraints on the actual running of the core business within Facebook and that nothing would change.
Comments from Facebook confirmed it would pay the $5 billion fine and said the settlement would provide “a comprehensive new framework for protecting people’s privacy.” Facebook’s shares closed about 1% higher.