Please ensure Javascript is enabled for purposes of website accessibility
Facebook Anticipates an FTC Privacy Fine of up to $5 Billion
gvw_ap_news
By Associated Press
Published 6 years ago on
April 25, 2019

Share

SAN FRANCISCO — Facebook said it expects a fine of up to $5 billion from the Federal Trade Commission, which is investigating whether the social network violated its users’ privacy.

Facebook has had several high-profile privacy lapses in the past couple of years. The FTC has been looking into Facebook’s involvement with the data-mining firm Cambridge Analytica scandal since last March.
The company set aside $3 billion in its quarterly earnings report Wednesday as a contingency against the possible penalty but noted that the “matter remains unresolved.”
The one-time charge slashed Facebook’s first-quarter net income considerably, although revenue grew 26% in the period. The FTC has been looking into whether Facebook broke its own 2011 agreement promising to protect user privacy.
Investors shrugged off the charge and sent the company’s stock up more than 9% to almost $200 in after-hours trading. EMarketer analyst Debra Aho Williamson, however, called it a “significant development” and noted that any settlement is likely to go beyond a mere dollar amount.
“(Any) settlement with the FTC may impact the ways advertisers can use the platform in the future,” she said.
Facebook has had several high-profile privacy lapses in the past couple of years. The FTC has been looking into Facebook’s involvement with the data-mining firm Cambridge Analytica scandal since last March. That company accessed the data of as many as 87 million Facebook users without their consent.

Facebook Faces Several Others Investigations

The 2011 FTC agreement bound Facebook to a 20-year privacy commitment; violations could subject Facebook to fines of $41,484 per violation per user per day. The agreement requires that Facebook’s users give “affirmative express consent” any time that data they haven’t made public is shared with a third party.
The now-defunct Cambridge Analytica, which provided political data services to the 2016 Trump campaign and others, had wide access to normally private user data. It exploited a Facebook loophole that allowed it to see the data of people’s friends, and not just people who explicitly permitted access when they took a personality quiz. While Facebook did have controls in place that allowed people to restrict such access, they are found buried in the site’s settings and are difficult to find.
In addition to the FTC investigation, Facebook faces several others in the U.S. and Europe, including one from the Irish Data Protection Commission, and others in Belgium and Germany. Ireland is Facebook’s lead privacy regulator for Europe. The FTC is also reportedly looking into how it might hold CEO Mark Zuckerberg accountable for the company’s privacy lapses.
The social network said its net income was $2.43 billion, or 85 cents per share in the January-March period. That’s down 51% from $4.99 billion, or $1.69 per share, a year earlier, largely as a result of the $3 billion charge.

Facebook Plans to Launch a Long-Promised ‘Clear History’ Tool

Revenue grew 26% to $15.08 billion from a year earlier. Excluding the charge, Facebook earned $1.89 per share. Analysts polled by FactSet expected earnings of $1.62 per share and revenue of $14.98 billion.

Revenue grew 26% to $15.08 billion from a year earlier. Excluding the charge, Facebook earned $1.89 per share. Analysts polled by FactSet expected earnings of $1.62 per share and revenue of $14.98 billion.
The company cautioned during a conference call with analysts that it faces “ad targeting headwinds” in the second half of this year. That includes developments such as Europe’s new privacy regulation that could impair hurt the company’s ability to target ads. Facebook also plans to launch a long-promised “clear history” tool that will let users delete their web-browsing tracks from Facebook’s data records while also blocking the social network from tracking the links they click going forward.
Zuckerberg, meanwhile, doubled down on his long-term vision to turn Facebook into a “privacy-focused platform” modeled after its encrypted messaging app WhatsApp. Analysts have questioned the company’s ability to make money if its focus shifts to private communications. But Zuckerberg said the company doesn’t currently use the content of messages for ad targeting anyway.
Facebook’s monthly user base on its flagship service grew 8% to 2.38 billion. Daily users grew 8% to 1.56 billion. The company said about 2.7 billion people used Facebook, WhatsApp, Instagram, or Messenger each month and 2.1 billion people used at least one of its services daily.

DON'T MISS

Elon Musk Reclaims Top Spot on Forbes’ Billionaires List

DON'T MISS

California Just Blew Its First Deadline for Voter-Approved Healthcare Measure

DON'T MISS

Trump Administration Halts Dozens of Research Grants at Princeton University

DON'T MISS

Fresno County Sheriff’s Pilot Takes His Last Flight as He Retires After 31 Years of Service

DON'T MISS

A Palestinian From the West Bank Is First Detainee Under 18 to Die in Israeli Prison, Officials Say

DON'T MISS

How Safe Is It to Walk to School? Fresno County Wants to Find Out

DON'T MISS

Baseball Is Back! How to Listen to Your MLB Favorites and the Grizzlies

DON'T MISS

Trump Says He’s Settled on a Tariff Plan That Is Set to Take Effect Wednesday

DON'T MISS

Auto Sales Surged in Anticipation of Trump’s Tariffs

DON'T MISS

Raid Or Rumor? Reports Of Immigrations Sweeps Are Warping Life In CA’s Central Valley

UP NEXT

California Just Blew Its First Deadline for Voter-Approved Healthcare Measure

UP NEXT

Lakers Hold Off Rockets With 6 3-Pointers Apiece From Dorian Finney-Smith, Gabe Vincent

UP NEXT

Athletics Bat Boy Stewart Thalblum Takes Down Drone in Left Field

UP NEXT

NFL Postpones Tush Push Decision but Passes Other Rule Changes, AP Source Says

UP NEXT

March Madness: It’s South Carolina vs. Texas and UCLA vs. UConn in Women’s Final Four

UP NEXT

Major Layoffs Begin at Health Agencies That Track Disease and Regulate Food

UP NEXT

CA Snowpack Is Near-Average. What Does This Mean for Water Supplies?

UP NEXT

U.S. Bank Executive Terry Dolan Dies in Plane Crash Near Minneapolis

UP NEXT

California Gov. Newsom Says the Democratic Brand Is ‘Toxic’

UP NEXT

Silver Fire Grows to 1,250 Acres, Threatens Homes in Inyo County

Fresno County Sheriff’s Pilot Takes His Last Flight as He Retires After 31 Years of Service

5 hours ago

A Palestinian From the West Bank Is First Detainee Under 18 to Die in Israeli Prison, Officials Say

6 hours ago

How Safe Is It to Walk to School? Fresno County Wants to Find Out

6 hours ago

Baseball Is Back! How to Listen to Your MLB Favorites and the Grizzlies

6 hours ago

Trump Says He’s Settled on a Tariff Plan That Is Set to Take Effect Wednesday

6 hours ago

Auto Sales Surged in Anticipation of Trump’s Tariffs

7 hours ago

Raid Or Rumor? Reports Of Immigrations Sweeps Are Warping Life In CA’s Central Valley

7 hours ago

House Speaker Johnson Fails to Squash a Proxy Voting Effort From New Moms in Congress

7 hours ago

UN Agency Closes Its Remaining Gaza Bakeries as Food Supplies Dwindle Under Israeli Blockade

8 hours ago

Hooters Goes Bust and Files for Bankruptcy Protection

8 hours ago

Elon Musk Reclaims Top Spot on Forbes’ Billionaires List

Elon Musk has reclaimed his position as the world’s wealthiest individual, according to Forbes’ 39th annual World’s Billio...

2 hours ago

2 hours ago

Elon Musk Reclaims Top Spot on Forbes’ Billionaires List

4 hours ago

California Just Blew Its First Deadline for Voter-Approved Healthcare Measure

Nassau Hall at Princeton University is in Princeton, N.J., Oct. 8, 2024. (AP File)
4 hours ago

Trump Administration Halts Dozens of Research Grants at Princeton University

After 31 years of service, Fresno County Sheriff’s Deputy IV and Pilot Michael Sill is retiring, having logged over 10,000 flight hours.
5 hours ago

Fresno County Sheriff’s Pilot Takes His Last Flight as He Retires After 31 Years of Service

Khalid Ahmad holds a poster of his 17-year-old son, Waleed, who died in an Israeli prison, that reads in Arabic, "The hero prisoner Martyr, mercy and eternity for our righteous Martyrs," in the West Bank town of Silwad, northeast of Ramallah Wednesday, March 26, 2025. (AP/Nasser Nasser)
6 hours ago

A Palestinian From the West Bank Is First Detainee Under 18 to Die in Israeli Prison, Officials Say

6 hours ago

How Safe Is It to Walk to School? Fresno County Wants to Find Out

6 hours ago

Baseball Is Back! How to Listen to Your MLB Favorites and the Grizzlies

Vehicles at an Audi showroom in Miami, March 29, 2025. President Donald Trump has said that tariffs would encourage auto companies and their suppliers to move to the U.S. (Saul Martinez/The New York Times)
6 hours ago

Trump Says He’s Settled on a Tariff Plan That Is Set to Take Effect Wednesday

Help continue the work that gets you the news that matters most.

Search

Send this to a friend