FTC Approves Massive $5 Billion USD Facebook Settlement Over Privacy Issues

The Federal Trade Commission has approved a $5 billion USD settlement with Facebook to end a probe into the company’s privacy practices that began after the Cambridge Analytica scandal revelations early last year, the Wall Street Journal reports.

The settlement would easily surpass the FTC‘s largest financial penalty to date, which was a $22.5 million USD fine against Google in 2012.

According to the report, the vote to settle with Facebook was predictably split across party lines: the three Republicans on the FTC voted in favor of the settlement, whereas the two Democratic Commissioners took the opposite stance, seemingly feeling that the settlement didn’t have enough impact. The report says “other government restrictions” have likely been included in the settlement, but they were unable to find out what said restrictions might be.

“This record-breaking fine highlights the importance of data stewardship in the digital age,” said Center for Democracy & Technology (CDT) President and CEO Nuala O’Connor. “The FTC has put all companies on notice that they must safeguard personal information.”

In late April, Facebook told investors it was expecting a fine of $3 billion USD to $5 billion over its privacy scandals. At the time, Facebook said it had already set aside $3 billion USD toward the potential settlement last quarter.

Capitol Hill Democrats and advocates of aggressive new privacy regulation panned the deal.

“The FTC just gave Facebook a Christmas present five months early,” Democratic Rep. David Cicilline, the chairman of the House Judiciary antitrust subcommittee, said in a tweet Friday evening.

“It’s very disappointing that such an enormously powerful company that engaged in such serious misconduct is getting a slap on the wrist,” Cicilline continued. “This fine is a fraction of Facebook’s annual revenue. It won’t make them think twice about their responsibility to protect user data. If the FTC won’t protect consumers, Congress surely must.”

The FTC opened its Facebook probe in March 2018, following reports that Cambridge Analytica had hoovered up the personal data of nearly 90 million Facebook users to better target them with political ads during the 2016 presidential election.