Facebook Could Pay $100M To Settle SEC Investigation

Facebook is expected to settle on Wednesday (July 24) with the Securities and Exchange Commission’s investigation into its privacy practices.

The SEC is expected to slap Facebook with a fine of over $100 million, a person familiar with the matter told The Wall Street Journal.

The investigation centered on allegations that Facebook didn’t disclose that users’ data was possibly obtained without their permission.

The SEC began probing Facebook after revelations that Cambridge Analytica, a data-analytics firm that had ties to President Trump’s 2016 campaign, got access to information on millions of Facebook users.

The SEC is one of several government agencies investigating Facebook and its handling of user data.

The FTC voted 3-2 in favor of a settlement with Facebook, and the case went to the Justice Department’s civil division to be reviewed. In 2011, Facebook and the FTC reached a consent decree in regards to protecting user privacy. The new case was over whether the social media firm violated that decree not.

Around the same time, the SEC started looking for information to determine how much Facebook knew about Cambridge Analytica’s use of the data. Facebook employees reportedly made known internal concerns about the issue in September 2015.

CEO Mark Zuckerberg told lawmakers in an April 2018 Congressional hearing that he, too, was among the 87 million Facebook users whose data ended up in the clutches of political consultancy Cambridge Analytica.

The social media giant was also hit with a March lawsuit by the Department of Housing and Urban Development over running real estate ads that discriminated against users. Facebook recently overhauled its policies, but previously employers and landlords were able to choose audiences for ads based on race, gender, and ethnicity. A similar lawsuit against Facebook from the ACLU was settled in March and resulted in Facebook changing its policies.