FTC confirms probe into Facebook and Cambridge Analytica data scandal

27 Mar 2018159 Views

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

FTC building in downtown Washington DC. Image: Andriy Blokhin

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

Hefty fines likely as FTC joins the parade of regulators and politicians keen to get to the bottom of what Cambridge Analytica was able to do with Facebook data.

Facebook shares plummeted further yesterday (26 March) after it emerged that the Federal Trade Commission (FTC) in the US is to investigate the company’s data practices following revelations around how Cambridge Analytica used data of 50m members of the social network.

The crux of the matter is the practices that enabled Cambridge Analytica to get the data, but also how it may have been used to tip the outcomes of the US presidential election in 2016 and the ‘leave’ vote that kick-started the Brexit process in the UK.

‘FTC takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook. Today, the FTC is confirming that it has an open non-public investigation into these practices’
– TOM PAHL

Facebook stock fell 6.5pc yesterday, with the company seeing more than $70bn wiped off its stock value since the scandal emerged.

The FTC investigation carries with it potentially hefty fines, including a penalty of $40,000 per violation.

“The FTC is firmly and fully committed to using all of its tools to protect the privacy of consumers,” said Tom Pahl, acting director of the FTC’s Bureau of Consumer Protection.

“Foremost among these tools is enforcement action against companies that fail to honour their privacy promises – including to comply with Privacy Shield – or that engage in unfair acts that cause substantial injury to consumers in violation of the FTC act.

“Companies who have settled previous FTC actions must also comply with FTC order provisions imposing privacy and data security requirements.

“Accordingly, the FTC takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook. Today, the FTC is confirming that it has an open non-public investigation into these practices.”

Tech giants distance themselves from Facebook

Meanwhile, Apple CEO Tim Cook moved to distance his company from the scandal, emphasising the principled stance that it has always taken in terms of privacy.

CNN reported comments made at the China Development Forum in Beijing where Cook described Facebook’s alleged misuse of data as “so dire” and “so large that probably some well-crafted regulation is necessary”.

On the matter of data harvesting, Cook added: “The ability of anyone to know what you’ve been browsing about for years, who your contacts are, who their contacts are, things you like and dislike, and every intimate detail of your life – from my own point of view, it shouldn’t exist.”

Embattled Facebook CEO Mark Zuckerberg recently took out ads in prominent UK newspapers including the Sunday Telegraph, Sunday Times, Mail on Sunday, Sunday Mirror and Sunday Express to apologise for the breach.

Zuckerberg said Facebook could have done more to stop users’ data being exploited in this fashion.

In the ad, Zuckerberg said a quiz developed by university research “leaked Facebook data of millions of people in 2014”.

He continued: “This was a breach of trust, and I’m sorry we didn’t do more at the time. We’re now taking steps to make sure this doesn’t happen again.”

FTC building in downtown Washington DC. Image: Andriy Blokhin/Shutterstock

Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com