The Federal Trade Commission has voted to approve an approximately $5bn settlement with Facebook over privacy violations, in a deal that will also overhaul how the social media giant handles user data.
In a decision split down party lines, the three Republican commissioners voted in favour of the settlement, with two Democrats coming out against it, according to a person familiar with the deal.
The fine and the changes to Facebook’s business practices must now be reviewed the US Department of Justice before they are formally announced. It is unclear how long this will take, the person added.
The $5bn figure, which would be the largest civil penalty handed out by the FTC to date, is at the higher end of the of $3bn to $5bn range that Facebook said earlier this year that it was expecting.
The terms of the settlement are “very granular”, said the person familiar with the deal. These include proposals to change how Facebook handles and stores user data and what customers know about those practices, the person said, as well as making the company more transparent to the FTC.
The regulator first launched its probe into Facebook in March 2018, in the wake of the Cambridge Analytica data scandal in which user data was leaked to a political research group through a third party app. It investigated whether Facebook breached an earlier settlement that it signed with the FTC in 2011.
That order required it to be clear to users about the privacy of their personal information and get explicit permissions if it changed the way their data was shared.
In its first quarter earnings, the social network set aside $3bn to cover the penalty, in keeping with accounting guidelines, hitting its profits. Facebook and the FTC declined to comment.