Tags: Cybersecurity | Financial Markets | Money | federal | trade | commission | facebook

Facebook's $5B Privacy Settlement to Be Largest Ever to FTC

a laptop lays on a table with a large facebook logo shown on its screen in a dark room
(Dominic Lipinski/AP)

Monday, 22 July 2019 03:28 PM

A roughly $5 billion settlement with Facebook Inc is expected to be announced by the U.S. Federal Trade Commission as early as this week after its investigation into the social media company's handling of user data, two sources briefed on the matter said Monday.

The FTC, Justice Department and Facebook declined to comment. The FTC has been investigating allegations Facebook inappropriately shared information belonging to 87 million users with the now-defunct British political consulting firm Cambridge Analytica. Reuters and other outlets reported July 12 the FTC had voted to approve the settlement but was awaiting the concurrence of the Justice Department.

The settlement is expected to include government restrictions and oversight on how Facebook treats user privacy. It would mark the largest civil penalty ever paid to the FTC.

Some in Congress have criticized the reported $5 billion penalty, noting Facebook in 2018 had $55.8 billion in revenue and $22.1 billion in net income. Sen. Marsha Blackburn, R-Tenn., said last week the fine should be "$50 billion."

While the deal resolves a major regulatory headache for Facebook, the Silicon Valley firm still faces further potential antitrust probes as the FTC and Justice Department undertake a wide-ranging review of competition among the biggest U.S. tech companies. Facebook is also facing public criticism from President Donald Trump and others about its planned cryptocurrency Libra over concerns about privacy and money laundering.

The Cambridge Analytica missteps, as well as anger over hate speech and misinformation on its platform, have prompted calls from people ranging from presidential candidate Sen. Elizabeth Warren, D-Mass., to a Facebook co-founder, Chris Hughes, for the government to force the social media giant to sell Instagram, which it bought in 2012, and WhatsApp, purchased in 2014.

But the company's core business has proven resilient, as Facebook blew past earnings estimates in the past two quarters. Facebook is set to report earnings Wednesday.

© 2021 Thomson/Reuters. All rights reserved.

After its investigation into the social media company's handling of user data, the U.S. Federal Trade Commission will announced a roughly $5 billion settlement with Facebook Inc as early as this week, according to two sources briefed Monday on the matter.
federal, trade, commission, facebook, privacy, data
Monday, 22 July 2019 03:28 PM
Newsmax Media, Inc.

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

America's News Page
© Newsmax Media, Inc.
All Rights Reserved