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Facebook Faces $5 Bln FTC Fine Over Privacy Violations

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The Federal Trade Commission has approved a nearly $5 billion settlement with Facebook Inc. over the social media giant's 2018 Cambridge Analytica scandal, according to several reports.

However, the settlement needs to be approved by the Justice Department and a final announcement could come next week.

The fine would be the largest ever imposed by the FTC on a technology company. Previously, the agency's largest fine against a tech company was the $22.5 million fine imposed on Google in 2012.

Earlier this year, reports indicated the FTC was considering imposing a "record-setting fine" against Facebook for allegedly failing to protect users' data and for violated a legally binding agreement with the U.S. government to protect the privacy of the data.

The FTC has been investigating allegations that Facebook shared data relating to millions of users with British political consulting firm Cambridge Analytica.

Facebook came under heavy criticism last year in the wake of revelations that data relating to 87 million people was accessed by Cambridge Analytica, which was linked to U.S. President Donald Trump's election campaign, without their permission.

However, the FTC's settlement has drawn criticism from several senators and Congress members as being inadequate.

David Cicilline, a Democrat and Co-Chair of the Democratic Policy and Communications Committee said on Twitter, "This fine is a fraction of Facebook's annual revenue. It won't make them think twice about their responsibility to protect user data."

While reporting its first-quarter financial results in April, Facebook said it recorded a charge of $3 billion in connection with the FTC's inquiry into the company's platform and user data practices. The company estimated the range of loss regarding the matter to be $3 billion to $5 billion.

In October 2018, the UK's data protection watchdog fined Facebook 500,000 pounds, or $645,000, over the Cambridge Analytica scandal for "serious breaches of data protection law."

The fine was the maximum allowable under the laws which applied at the time the incidents occurred, according to the UK's Information Commissioner's Office or ICO.

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