Daily Management Review

Facebook to pay $5 bln fine within Cambridge Analytica scandal


07/25/2019


Facebook will pay $ 5 billion in settlement of the US Federal Trade Commission (FTC)’s charges in violation of user privacy. The agreement was announced by the FTC; the paper is yet to be approved by the court, the AP reports. The regulator itself called the amount of payments an historical record.



Book Catalog via flickr
Book Catalog via flickr
On top of this amount, the Internet company will pay a $ 100 fine to the US Securities and Exchange Commission (SEC) for not adequately informing the social network’s users about the risks of leaks and personal data abuses. The regulator found out that Facebook has been calling such cases “hypothetical” for two years, although the company definitely knew that Cambridge Analytica had committed such abuses.

Officially, Facebook does not admit guilt in any of these cases.

Claims of the FTC to Facebook were also included in the Cambridge Analytica investigation. The regulator found that the British company illegally collected data from tens of millions of users in the United States, so that results of the analysis of these data could be used in US election campaigns in 2016 and before Brexit to serve interests of individual parties.

Under the agreement reached with the FTC, Facebook will be obliged to make it difficult for third-party developers to access the personal data of users. The company was banned from using telephone numbers of users for advertising. Facebook was also obliged to provide a clear notice of the use of facial recognition technology and not to use it without official consent of the user. The company was also obliged to encrypt user passwords and periodically check databases for unencrypted passwords. Now the website will need to develop and implement a comprehensive program to protect user data and introduce liability for violations for employees at all levels.

Facebook's General Counsel, Colin Stretch, said that the company would tighten personal security measures, including technical ones, after an agreement with the FTC. He wrote that the pre-trial settlement will end the question of whether Facebook had violated the law.

The agreement with FTC also provides for tightening the rules for access to client data for third-party application developers and requires Facebook not to use phone numbers of users for advertising.

The company will have to regularly check new practices for compliance with stricter requirements, and head and founder of Facebook Mark Zuckerberg will be personally responsible for the accuracy of these checks.

In addition, the regulator ordered Facebook to report all incidents that could jeopardize data of 500 or more users, and provide relevant documentation within 30 days.

source: theguardian.com