Facebook expects to pay a fine of up to $5 billion in a settlement with federal regulators. The tech giant disclosed that figure in its first-quarter 2019 financial results.

Facebook has been in negotiations with the Federal Trade Commission following concerns that the company violated a 2011 consent decree. Back then, company leaders promised to give consumers “clear and prominent notice” when sharing their data with others and to get “express consent.”

But, experts say, Facebook broke its promise. Just one example: giving user data to Cambridge Analytica, the political consulting firm that did work for the 2016 Trump campaign.

Facebook estimates the fine will be in the $3 billion to $5 billion range and has set aside $3 billion for payment. The company’s statement says, “The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome.”

This would not be the largest fine issued by the FTC. In 2016, the agency reached settlements with Volkswagen totaling up to $14.7 billion. Facebook’s total revenue for the first quarter stood at more than $15 billion. So whatever the final figure, the company has the money to pay for the estimated fine.

Facebook’s monthly active users stand at 2.38 billion, an increase of 8% year over year.

In an earnings call, CEO Mark Zuckerberg did not discuss the settlement in any detail. He focused his remarks on outlining Facebook’s plans for growth, which include building a private messaging platform. He also pointed to the European model of privacy regulation as one that could work globally, if other countries chose to follow suit.

Let’s block ads! (Why?)

Source:: https://www.npr.org/2019/04/24/716886822/facebook-could-face-up-to-5-billion-fine-for-privacy-violations?utm_medium=RSS&utm_campaign=business