Facebook to Pay Largest Fine in History for Privacy Violations

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SWITZERLAND, JULY 25 – The United States Federal Trade Commission announced a $5 billion settlement with Facebook on Wednesday, resolving a sweeping investigation by regulators into how the company lost control over massive troves of personal data and mishandled its communications with users. It is the largest fine in FTC history — and yet still only about a month’s worth of revenue for Facebook.

The deal comes amid growing calls in Washington for greater transparency and accountability for technology companies, whose power over social movements as well as personal information has increasingly come to be seen as dangerous by politicians, users, and even one of Facebook’s co-founders.

Facebook agreed to the deal following years of damaging admissions about the company’s privacy practices, such as the inadvertent exposure of up to 87 million users’ information to the political analysis firm Cambridge Analytica. The settlement resolves a formal complaint by the FTC alleging that Facebook “used deceptive disclosures and settings” that eroded user privacy, violating a prior agreement Facebook signed with the commission in 2012.

Facebook also broke the law, the FTC alleged, by misusing phone numbers obtained for account security purposes to also target advertisements to its users. And the company allegedly deceived “tens of millions of users” by implying that a facial recognition feature on the service had not been enabled by default, when in fact it had.

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