July 12, 2019

Facebook reportedly agrees to $5 billion settlement with FTC

On July 12, 2019, media sources reported that the Federal Trade Commission had voted to approve a $5 billion settlement with Facebook, Inc. to resolve the FTC’s investigation of the company’s privacy practices in connection with the release of personal data belonging to over 80 million users to a third party consulting firm based in the UK, and in light of a 2011 agreement between Facebook and the FTC.  The investigation was disclosed by Facebook in earlier filings with the Securities and Exchange Commission, in which the company said that its “platform and user data practices, as well as the events surrounding the misuse of certain data by a developer, became the subject of a US Federal Trade Commission, Securities and Exchange Commission, state attorneys general, and other government inquiries in the United States, Europe, and other jurisdictions” in March 2018, leading the company to estimate a probable loss and to record an accrual of $3.0 billion in connection with the inquiry of the FTC in its April 24, 2019 quarterly report.

The reported settlement amount, if accurate, would far exceed all previous civil penalties exacted by the FTC.

Form 10-Q