Facebook To Face Record $5 Billion FTC Settlement Related To Cambridge Analytica Scandal

By 07/15/2019
Facebook To Face Record $5 Billion FTC Settlement Related To Cambridge Analytica Scandal

YouTube isn’t the only media giant reportedly about to be hit with a Federal Trade Commission (FTC) settlement over its handling of users’ data.

The commission has agreed to levy a record $5 billion fee against Facebook for charges stemming from the Cambridge Analytica scandal, The New York Times reports. If the fine is approved by the Department of Justice — which, per the Times, rarely rejects the FTC’s proposed settlement terms — it will be the largest ever imposed by the commission on a tech company, far outweighing the previous record fine of $22 million levied against Google in 2012.

For those who don’t know, Cambridge Analytica is a British data firm with ties to the 2016 Donald Trump campaign. During the lead-up to the election, it harvested the personal data of nearly 90 million Facebook users and employed that data for political purposes. When details of the firm’s actions came to light in March 2018, it prompted Congress to pull Facebook co-founder and CEO Mark Zuckerberg in for an hours-long grilling about everything to do with how his company handles private data.


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The scandal also led Facebook to revamp its terms of service to more clearly explain what it does with users’ data, particularly when it comes to how it sells that data to third parties. And, most recently, it led the platform to add more tools for users to control which marketers and data brokers have their information.

The FTC’s settlement rules that Facebook’s actions violate the terms of an earlier FTC settlement, imposed on the company in 2011. That settlement hinged on the FTC’s judgement that Facebook wasn’t honest with users about what it did with their data. It stated, among other things, that Facebook was officially “barred from making misrepresentations about the privacy or security of consumers’ personal information.”

Along with paying the $5 billion fine, Facebook will now have to agree to stringent oversight of its user data handling practices, people familiar with the matter told the Times. However, the settlement surprisingly contains zero terms restricting Facebook’s ability to share data with third parties — the very thing that caused the Cambridge Analytica incident in the first place.

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