An investigation into the data privacy scandal between Cambridge Analytica and Facebook has had the social network slammed with a $5b fine according to news reports. The Facebook fine becomes the largest so far ever levied on a tech firm by the FTC.
Cambridge Analytica was a British-owned political consulting firm accused of harvesting the data of about 87 million users. The data was obtained via a quiz on Facebook. The result was used to psychologically profile US voters in favour of Donald Trump during the 2016 presidential campaign. As common with third party apps on Facebook, the quiz was designed to harvest the data of the people partaking in the quiz and those of their friends. Facebook admitted in 2018 that Cambridge Analytica may have unlawfully harvested data of up to 87 million Facebook users.
However, Cambridge Analytica denied using the data in the US presidential election. Facebook had no other choice than to apologise to users for a breach of privacy and trust. After all, the breach was made possible via its platform.
The scandal which sparked several investigations around the globe pushed the British-owned firm into bankruptcy, with the social network waiting for its fine.
The Federal Trade Commission approved the settlement of $5b in a 3-2 vote in favour of the Republican after the completion of the investigations which began in March 2018. The focus of the investigation was to determine if Facebook violated a 2011 agreement which required the social network to notify its users about sharing their data.
Facebook had been waiting for the settlement. It told investors that there was money set aside for a fine so that the company won’t feel much financial strain from the penalty. The fine is estimated to be around a quarter of the company’s yearly profit. It had set $3b aside in April to cover the potential cost of the investigation.
Nevertheless, the fine is yet to be finalised by the Justice Department’s civil division and this might take an entirely new process. No one is sure. Some critics allege that the fine is not a tangible sum. If the Justice Department stays quiet a little longer, this fine might reawaken the criticism from the party who believes that Facebook should pay more.