Does the fine matter? Analysis: Chris Baraniuk, BBC technology reporter Facebook has deep pockets - the firm's annual revenue last year was $55bn. However, the FTC's fine will still irritate the tech giant. In a press release, the company acknowledged unequivocally that its involvement in the Cambridge Analytica scandal was "a breach of trust" with its users. The regulatory action will be taken by some as a general sign that mishandling user data can incur real consequences from US authorities. For years, apps and websites have casually harvested personal information for murky ends. While this will undoubtedly continue in many quarters, with every crackdown, such activity only becomes more contentious. But there are those who think the FTC could have gone further. And one, Alex Stamos, Facebook's former chief security officer, thinks the settlement actually benefits the company. By restricting the flow of data, Facebook may get to effectively hoard its 2.4 billion users, he argues, rather than allow them to access third-party apps or competing social networks. Former Cambridge Analytica chief executive Alexander Nix What happened to Cambridge Analytica? In May 2018, Cambridge Analytica filed for bankruptcy in the US, blaming a "siege of media coverage" for driving away customers and forcing its closure. As part of a separate settlement with the FTC, two of the defendants - former Cambridge Analytica chief executive Alexander Nix and app developer Aleksandr Kogan - have agreed to administrative orders restricting how they conduct any business in the future. The pair are also required to delete or destroy any personal information they collected. What does Facebook say it will do in the future? In a post on Facebook, Mr Zuckerberg said that the firm would be making structural changes to how its products were built and how the company is run. Privacy practices would now be headed by a new chief privacy officer for products. "We have a responsibility to protect people's privacy," Mr Zuckerberg wrote. He added that Facebook was reviewing its technical systems to find possible privacy risks, and going forward, whenever the social network built a new product that used data, or a feature changed the way it used data, possible privacy risks would need to be documented and mitigated. These new practices would go far beyond what is currently required of tech firms under US law, he added. "We expect it will take hundreds of engineers and more than a thousand people across our company to do this important work. And we expect it will take longer to build new products following this process going forward," he said.The government just announced its proposed settlement with Facebook for its privacy failures. $5 billion sounds like a lot, but the fine print in the settlement has a lot for $FB to celebrate. I voted no. Here”™s why.
— Rohit Chopra (@chopraftc) July 24, 2019
Is Facebook facing other investigations?
At the same time that the FTC made its announcement, the US Securities and Exchange Commission (SEC) announced charges against Facebook for making misleading disclosures regarding the risk of misuse of user data. As a result, Facebook has agreed to pay $100m to settle the charges. The SEC found that although Facebook discovered the misuse of its users' information in 2015, it did not clarify this for two years, instead telling investors that users' data "may" have been improperly accessed. The social network also told the media that it had discovered no evidence of wrongdoing in Cambridge Analytica's use of Facebook user data. Furthermore, Facebook did not have specific procedures in place to assess the results of their investigation in order to make accurate disclosures in Facebook's public filings. The US Department of Justice (DoJ) is also investigating leading online platforms to see whether they are unfairly restricting competition. The DoJ did not name any firms, but companies such as Facebook, Google, Amazon and Apple are likely to be scrutinised in the wide-ranging probe. It was sparked by "widespread concerns" about "search, social media, and some retail services online," the DoJ said.DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
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