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Meta, US Dept. Of Justice Reach Settlement Over Discriminating Housing Ads

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The US Department of Justice said on Tuesday that it has arrived at a settlement with Facebook owner Meta (FB) about allegations that the social media platform indulged in discriminatory advertising, which was in violation of federal housing law.

The investigation originated from a 2019 discrimination allegation evoked by the Department of Housing and Urban Development. The HUD opted to transfer the case to the DOJ after the company voted to have the charge heard in federal court.

The DOJ alleged that Facebook targeted users with housing ads based on algorithms, which depended on features protected under the Fair Housing Act, like race, national origin and sex. Allegations were also made that Meta's lookalike or special ad audience tool allowed advertisers to open up before users based on protected traits.

The settlement, for whom the court approval is pending, would require Meta to stop using the tool for housing ads, which, according to the government relies on an algorithm that discriminates based on protected characteristics.

Facebook has to create a new system for housing ads by December, which the government has to approve. If the government accepts the system, Meta will have to submit it to regular third-party reviews to ensure it remains in compliance. The settlement will be dissolved and the case will go back to the federal court if the new ad system is also not up to the mark.

Meta would have to pay the maximum penalty under the Fair Housing Act of $115,054 under the settlement.

Kristen Clarke, DOJ assistant attorney general of the civil rights division, said in a statement, "As technology rapidly evolves, companies like Meta have a responsibility to ensure their algorithmic tools are not used in a discriminatory manner."

In a company blog post after the announcement, Meta said that the agreement was the result of "more than a year of collaboration with HUD to develop a novel use of machine learning technology that will work to ensure the age, gender and estimated race or ethnicity of a housing ad's overall audience matches the age, gender and estimated race or ethnicity mix of the population eligible to see that ad."

Meta said that it had already set limited options for advertisers running housing ads and the new system in place would aim "to make additional progress toward a more equitable distribution of ads through our ad delivery process."

The company went on to say that it would also expand this approach to include ad targeting employment and credit, thus putting a stop to its special ad audiences targeting tool for those categories.

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