Facebook slapped with divisive $5 billion fine by FTC

(Photo by Chip Somodevilla/Getty Images)

Facebook is to be hit with a $5 billion fine in regards to the FTC’s investigation about the Cambridge Analytica Scandal. The fine, which is the largest in FTC history, is one which comes with strings attached. While the report isn’t exactly clear, the Washington Post suggests that Facebook would now face government oversight as part of the conditions for the cessation of the investigation.

The Post reports:

Under the FTC’s new settlement, the consequences for Facebook could be vast: The tech giant may have to document every decision it makes about data before offering new products, keep closer watch over third-party apps that tap users’ information, and require its top executives, including Facebook CEO Mark Zuckerberg, to attest that the company adequately has protected privacy.

The fine’s reception has been divisive, to say the least, with critics arguing it amounts to no more than a trivially easy, barely inconvenient slap on the wrist.

“The FTC just gave Facebook a Christmas present five months early. It’s very disappointing that such an enormously powerful company that engaged in such serious misconduct is getting a slap on the wrist.” Congressman David Cicilline said. “If the FTC won’t protect consumers, Congress surely must.”

“We shouldn’t be fooled by the size of this fine. It may be a record for the timid FTC, but $5 billion is chump change for Facebook, which had $15 billion in revenue last quarter,” Walt Mossberg said, “Only a breakup, or new governance, or strong regulation, will matter.”

“Here’s another way to say it: the biggest FTC fine in United States history increased Mark Zuckerberg’s net worth. What lesson would you learn from that? Would anyone?” The Verge’s Nilay Patel argued. “[F]ines and punishments are only effective when they provide negative consequences for bad behavior. But Facebook has done nothing but behave badly from inception, and it has only ever been slapped on the wrist by authority figures and rewarded by the market.

On the other hand, not everyone argued with the presentation of the fine as trivial, pointing out other that the fine DID come with the promise of additional governmental oversight and regulation.

With the FTC having voted on the upcoming fine, it will now move towards the Justice Department for final approval.