Facebook to create privacy panel, pay $5bn to US to settle allegations

Facebook has been facing issues in data protection and privacy. (File/AFP)
Updated 24 July 2019
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Facebook to create privacy panel, pay $5bn to US to settle allegations

  • As part of the settlement, Facebook will agree to create a board committee on privacy
  • It will also agree to new executive certifications that users’ privacy is being properly protected

WASHINGTON: The Federal Trade Commission is set to announce on Wednesday that Facebook Inc. has agreed to a sweeping settlement of significant allegations it mishandled user privacy and pay $5 billion, two people briefed on the matter said.
As part of the settlement, Facebook will agree to create a board committee on privacy and will agree to new executive certifications that users’ privacy is being properly protected, the people said.
Facebook Chief Executive Mark Zuckerberg will have to certify every three months that the company is properly safeguarding user privacy, a person briefed on the matter said.
The Washington Post reported on Tuesday that the FTC will allege Facebook misled users about its handling of their phone numbers and its use of two-factor authentication as part of a wide-ranging complaint that accompanies a settlement ending the government’s privacy probe, citing two people familiar with the matter.
Separately, the US Securities and Exchange Commission is expected to announce a related settlement with Facebook for around $100 million over allegations it failed to disclose risks to investors over its privacy practices. The Wall Street Journal reported the SEC settlement earlier.
The Post also reported the FTC also plans to allege Facebook provided insufficient information to about 30 million users about a facial recognition tool, an issue identified earlier by Consumer Reports.
The settlement comes amid growing concern among US policymakers about the privacy of online users and have sparked calls for new legal protections in Congress. Separately, the US Justice Department said late Tuesday it is launching a broad antitrust probe into the competitive practices of large tech companies like Facebook.
Two people briefed on the matter confirmed the Post report the FTC will not require Facebook to admit guilt as part of the settlement. The settlement will need to be approved by a federal judge and will contain other significant allegations of privacy lapses, the people said.
The fine will mark the largest civil penalty ever paid to the FTC.
The FTC and Facebook declined to comment.
The FTC confirmed in March 2018 it had opened an investigation into allegations Facebook inappropriately shared information belonging to 87 million users with the now-defunct British political consulting firm Cambridge Analytica. The probe has focused on whether the data sharing violated a 2011 consent agreement between Facebook and the regulator and then widened to include other privacy allegations.
A person briefed on the matter said the phone number, facial recognition and two-factor authentication issues were not part of the initial Cambridge Analytica probe.
Some in Congress have criticized the reported $5 billion penalty, noting Facebook in 2018 had $55.8 billion in revenue and $22.1 billion in net income. Senator Marsha Blackburn, a Republican, said last week the fine should be $50 billion.
While the deal resolves a major regulatory headache for Facebook, the Silicon Valley firm still faces further potential antitrust probes as the FTC and Justice Department undertake a wide-ranging review of competition among the biggest US tech companies. Facebook is also facing public criticism from President Donald Trump and others about its planned cryptocurrency Libra over concerns about privacy and money laundering.
The Cambridge Analytica missteps, as well as anger over hate speech and misinformation on its platform, have prompted calls from people ranging from presidential candidate Senator Elizabeth Warren to a Facebook co-founder, Chris Hughes, for the government to force the social media giant to sell Instagram, which it bought in 2012, and WhatsApp, purchased in 2014.
But the company’s core business has proven resilient, as Facebook blew past earnings estimates in the past two quarters. Facebook is set to report earnings on Wednesday.


Google says misinformation campaign used YouTube to target Hong Kong protests

Updated 23 August 2019
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Google says misinformation campaign used YouTube to target Hong Kong protests

SAN FRANCISCO, US: Google on Thursday said it disabled a series of YouTube channels that appeared to be part of a coordinated influence campaign against pro-democracy protests in Hong Kong.
The announcement by YouTube’s parent company came after Twitter and Facebook accused the Chinese government of backing a social media campaign to discredit Hong Kong’s protest movement and sow political discord in the city.
Google disabled 210 YouTube channels that it found behaved in a coordinated manner while uploading videos related to the Hong Kong protests, according to Shane Huntley of the company’s security threat analysis group.
“This discovery was consistent with recent observations and actions related to China announced by Facebook and Twitter,” Huntley said in an online post.
Twitter and Facebook announced this week that they suspended nearly 1,000 active accounts linked to a coordinated influence campaign. Twitter said it had shut down about 200,000 more before they could inflict any damage.
“These accounts were deliberately and specifically attempting to sow political discord in Hong Kong, including undermining the legitimacy and political positions of the protest movement on the ground,” Twitter said, referring to the active accounts it shut down.
Facebook said some of the posts from accounts it banned compared the protesters in Hong Kong with Daesh group militants, branded them “cockroaches” and alleged they planned to kill people using slingshots.
China has “taken a page from Russia’s playbook” as it uses social media platforms outside the country to wage a disinformation campaign against the protests, according to the non-profit Soufan Center for research, analysis, and strategic dialogue related to global security issues.
“Beijing has deployed a relentless disinformation campaign on Twitter and Facebook powered by unknown numbers of bots, trolls, and so-called ‘sock puppets,’” the center said on its website, referring to fake online identities created for deception.
“China’s behavior will likely grow more aggressive in both the physical and virtual realms, using on-the-ground actions to complement an intensifying cyber campaign characterized by disinformation, deflection, and obfuscation.”

Misused by autocratic regimes
While social media platforms have been tools for people to advocate for rights, justice or freedom in their countries, the services are being turned on them by oppressive governments, according to the Soufan Center.
“Autocratic governments are now using these same platforms to disparage demonstrators, divide protest movements, and confuse sympathetic onlookers,” the center said.
Hong Kong, a semi-autonomous southern Chinese city and one of the world’s most important financial hubs, is in the grip of an unprecedented political crisis that has seen millions of people take to the streets demanding greater freedoms.
China’s government has publicly largely left the city’s leaders and police force to try and resolve the crisis, but behind the scenes online, Beijing is seeking to sway public opinion about Hong Kong, according to Twitter and Facebook.
“We are disclosing a significant state-backed information operation focused on the situation in Hong Kong, specifically the protest movement and their calls for political change,” Twitter said.
It said it had pulled 936 accounts originating in China that were spreading disinformation.
Twitter and Facebook are banned in China, part of the government’s so-called “Great Firewall” of censorship.
Because of the bans, many of the fake accounts were accessed using “virtual private networks” that give a deceptive picture of the user’s location, Twitter said.
Facebook said it had acted on a tip from Twitter, removing seven pages, three groups and five Facebook accounts that had about 15,500 followers.
“Although the people behind this activity attempted to conceal their identities, our investigation found links to individuals associated with the Chinese government,” Facebook said.