Facebook Will Pay $5 Billion Fine To FTC

Facebook will Pay $5 Billion Fine to FTC

by Alex Noah — 5 years ago in Business Ideas 2 min. read

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Federal Trade Commission officially announced its $5 billion settlement with Facebook on Wednesday afternoon, that’s the culmination of a years-long investigation to the Cambridge Analytica scandal along with other privacy breaches.

From the agreement filed today, the FTC stated that Facebook violated the law by failing to shield data from third parties, serving advertisements through the use of telephone numbers supplied for safety, and lying to consumers that its facial recognition applications were turned off by default. To be able to settle these fees, Facebook will cover $5 billion — that the second-largest fine ever levied by the FTC — and consent to a set of new limitations on its company.

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Besides this multibillion-dollar good, Facebook is going to be asked to run a privacy review of each new product or service it grows, and such reviews have to be submitted to the CEO and also a third party assessor annually. Since it directly relates to Cambridge Analytica, Facebook will then be asked to receive use and purpose certificates from programs and third party developers looking to use Facebook user information. But, there are no limitations on which information access the corporation may authorize to all those groups after the disclosure is made.

“The Order includes a privacy plan that contains a brand new corporate governance structure, together with individual and corporate liability and stricter compliance tracking,” both encouraging FTC commissioners composed in an announcement. “This strategy dramatically increases the probability that Facebook is going to be compliant with the Purchase; when there are any deviations, they probably will be discovered and remedied quickly.”

Facebook’s facial recognition program comes under fire in the payoff. Under the rules, the business will be asked to obtain affirmative permission to create fresh facial recognition versions, though it won’t be asked to ruin old models which might have been made with no approval.

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Based on coverage by The Washington Post, the FTC voted to accept the 5 billion penalty along party lines, with all the Democratic minority associates rejecting the settlement insufficient. Democratic commissioners were especially concerned that Mark Zuckerberg and other high tech executives were exempted from any liability for the offenses, the Post found. However, the agency abstained from pursuing much larger punishments such as a substantially bigger fine and locating CEO Mark Zuckerberg personally accountable.

For the Democratic FTC commissioners, these meager penalties resorted to allowing Facebook off the hook. “However, the stipulations, such as blanket immunity for Facebook executives without a real restraints on Facebook’s business model, don’t repair the heart problems that resulted in those offenses.”

“The settlement requires no significant adjustments to the organization’s structure or fiscal incentives,” Chopra continuing,”nor does it include any limitations on the organization’s mass surveillance or promotion strategies. Instead, the arrangement enables Facebook to decide for itself how much info it could harvest from consumers and what it could do with this data, so long as it makes a paper trail”.