Add the Open Markets Institute (OMI) to the list of those who say that a likely multi-billion settlement with Facebook over privacy practices isn't enough.
Facebook signaled Wednesday (April 24) in its first-quarter financial statement that it was going to have to factor in an up-to-$5 billion payout related to the Federal Trade Investigation into whether Facebook had violated a 2011 consent decree related to its data privacy protection or, more to the point, lack of it.
Related: Sen. Wyden Says Facebook Should Be Liable for Privacy Violations
At the upper end, the fine would constitute a third of the almost $15 billion in revenue for the quarter.
But OMI Executive Director Barry Lynn sees the likely fine as "grossly insuffient" for what he says was Facebook's "outrageous" behavior.
"Facebook for years demonstrated complete disregard for its original agreement with the FTC," he said in a statement. "By failing to stand up for its own authority, the FTC appears, in turn, to be demonstrating complete disregard for the fundamental interests of the American people," said Lynn. "Rule of law requires that enforcers of the law enforce the law. Congress should act immediately to ensure that all five members of the Commission fully understand their jobs, and the responsibilities entrusted to them by the American people. Democracy depends on breaking Facebook's stranglehold over the flow of news and information and ensuring the corporation fully respects and protects the privacy of the millions of citizens who use the platform. It’s time for all five of the FTC’s commissioners to do what the American people hired them to do.”
It was a year ago last month that the FTC confirmed it was investigating Facebook over its privacy and data security practices, saying it has "substantial concerns." Those have likely only increased with subsequent revelations, including congressional concerns about its research project that incentivized teens and others to give up info (Project Atlas) and news that the company was sharing data with big tech and is planning to integrate WhatsApp, Instagram and Facebook Messenger.
The FTC investigation followed the revelation that Cambridge Analytica had used Facebook user data without their knowledge to build profiles it then sold to political campaigns, including the Trump campaign. Analytica reportedly used the information with most users having not given their permission for Facebook to share it with a third party.
Facebook is under an FTC consent decree dating from its 2011 settlement of FTC allegations it deceived consumers by not keeping its privacy promises. The FTC is authorized to enforce such pledges under its Sec. 5 (unfair and deceptive practices) authority. The commission was investigating whether Facebook had violated that agreement
That consent decree required Facebook to obtain a users' permission before sharing data, so that Cambridge Analytica data dump appeared to be a violation of the agreement.
Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.
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