Settlement imposes historic penalty and significant requirements to boost accountability and transparency
Facebook assessed $5 billion penalty, subjected to sweeping new restrictions on user privacy decisions to settle FTC charges the company violated a 2012 FTC order by deceiving users about their ability to control privacy of their personal info. Read more: ftc.gov/news-events/pr…- Watch the press conference on the Facebook settlement LIVE at 11 am ET TODAY: kvgo.com/ftc/press-conf…
- Settlement imposes historic penalty and significant requirements to boost accountability and transparency
- $5 billion penalty against FB is the largest ever imposed on any co for violating consumers’ privacy, 200x greater than any prior privacy penalty in US + more than 20x larger than biggest privacy penalty ever imposed worldwide.Penalty is also one of the largest penalties ever assessed by US government for any violation.Settlement order requires company to restructure its approach to privacy from corp board-level down, establishes strong new mechanisms to ensure FB execs are accountable for privacy decisions and ensures decisions are subject to meaningful oversight.Following year-long investigation by FTC, @JusticeDept is expected to file a complaint on behalf of the FTC alleging that FB repeatedly used deceptive disclosures and settings to undermine users’ privacy preferences in violation of its 2012 FTC orderFacebook's tactics allowed co to share users’ personal info w/ third-party apps that were downloaded by users’ Facebook “friends.” FTC alleges many users were unaware that FB was sharing such info, and didn’t take steps needed to opt-out of sharing.FTC alleges Facebook took inadequate steps to deal with apps that it knew were violating its platform policies.Facebook also misrepresented users’ ability to control the use of facial recognition technology with their accounts.Related, FTC also filed admin complaints against data analytics company Cambridge Analytica, its former CEO Alexander Nix, and Aleksandr Kogan, an app developer who worked w/ the company.Read: FTC sues Cambridge Analytica, settles with former CEO and app developer, alleges they deceived Facebook users about data collection:Related, FTC also filed admin complaints against data analytics company Cambridge Analytica, its former CEO Alexander Nix, and Aleksandr Kogan, an app developer who worked w/ the company.Read: FTC sues Cambridge Analytica, settles with former CEO and app developer, alleges they deceived Facebook users about data collection:FTC alleged Cambridge, Nix and Kogan used false and deceptive tactics to harvest personal info from millions of Facebook users. Kogan and Nix have agreed to settlement with FTC that will restrict how they conduct any business in the future.Facebook order establishes an independent privacy committee of FB’s board of directors, removing unfettered control by FB CEO Mark Zuckerberg over decisions affecting user privacy.Members of privacy committee must be independent and will be appointed by an independent nominating committee. Members can only be fired by a supermajority of voting shares.Facebook is required to designate compliance officers to be responsible for its privacy program. Officers subject to approval of new board privacy committee and can be removed only by that committee—not by FB CEO or employees.Zuckerberg,designated compliance officers must independently submit to FTC quarterly certifications that FB is in compliance w/ privacy prog mandated by order + annual certification that co is in compliance w/ order. Any false certification are subject to civil/criminal penaltiesFacebook’s new privacy program must cover WhatsApp, Instagram & Messenger. FB must conduct a privacy review of every new or modified product, service, or practice before it is implemented, and document decisions about user privacy.Order imposes significantly new privacy requirements, including the following: -FB must exercise greater oversight over third-party apps, incl by terminating app developers that fail to comply w/ FB’s platform policies or justify need for specific user data;-FB is prohibited from using phone numbers it had obtained to enable a security feature (e.g., two-factor authentication) for advertising;-Company must provide clear, conspicuous notice of its use of facial recognition, and obtain express user consent prior to any use that materially exceeds its prior disclosures to users;Read a statement by @JoeSimonsFTC, @FTCPhillips, and Comm’r Wilson: ftc.gov/system/files/d…
