What the FTC's Crackdown on Facebook Means for User Data
Facebook must pay a $5 billion fine after the FTC found the social media company deceived users and improperly managed their personal data. Under the settlement, Facebook is also subject to stricter oversight on how it manages user data. WSJ explains what that means for users.
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- In July, the Federal Trade Commission fined Facbook for $5 billion for violating users' privacy. This is the largest fine the FTC has ever levied against a business. In 2012, the commission sued Facebook for misleading consumers about third-party access to user data, and more recently, the FTC found that Facebook was again sharing data with third-party companies even though many consumers had requested that their data remained private. The settlement puts Facebook under more intense scrutiny from the commission. Here's how the FTC says their rules for Facebook could protect consumers. Change number one, third-party apps will find it harder to get at your data. The settlement will force Facebook to increase its management of third-party developers. Facebook must now terminate developer access to user information if that developer can't justify their need for that data. Change number two, Facebook will need your active consent to keep your facial-recognition data. The FTC writes that the company must delete any existing facial-recognition data within 90 days of the order unless the company obtains users' affirmative consent to use it on templates in the future. Change number three, Facebook can't use your phone number for its advertising business without your consent. Has Facebook ever requested that you add a phone number for added security? It turns out Facebook may have used it to help sell ads. The new FTC order mandates that any given number in the guise of enhanced security may not be shared with advertisers or other third parties. Change number four, Facebook must quickly notify authorities when data has been compromised. The order also mandates that Facebook increase transparency when data of 500 or more users has been compromised. Facebook has to deliver notice within 30 days of the company's discovery of the incident alongside a description of steps taken to remediate the issue. The order will not resolve every issue that consumers may have with Facebook. In a press hearing, multiple FTC representatives stressed that changes may not be immediately obvious. - It is not the purpose of this investigation to vindicate every concern that the world has about Facebook. We have big national conversations going on about the company and others like it right now. Those are important conversations. They're going to continue. - Some at the FTC say the restrictions don't go far enough. One commissioner said that the settlement imposes no meaningful changes on the systems that led to these violations. The FTC order is narrowly focused on Facebook and more limited in scope than Europe's General Data Protection Regulation, or GDPR. That's because the U.S. doesn't have a comprehensive privacy protection law, FTC officials say. For that reason, FTC officials say they can't do much to limit the kinds of data Facebook's collecting. Instead, they have to focus on making sure that Facebook doesn't continue misleading consumers about how their data is being used. In a press release, Facebook said that the settlement will, quote, "mark a sharper turn toward privacy, "on a different scale than anything we've done in the past." (pleasant piano and orchestral music)