FTC To Hold Facebook CEO Mark Zuckerberg Liable For Any Future Privacy Violations (npr.org) 60
Facebook CEO Mark Zuckerberg will have to personally answer to federal regulators under an agreement to settle a privacy case with the Federal Trade Commission that includes a $5 billion penalty for the giant social media company, the agency announced Wednesday. From a report: Separately, Facebook will pay $100 million to settle a case with the Securities and Exchange Commission for making misleading disclosures about the risk that users' data would be misused, the SEC said. Under the FTC agreement, Zuckerberg will be required to submit quarterly compliance reports directly to the federal regulators and to Facebook's board of directors. If the Facebook co-founder or "designated compliance officers" violate the agreement, they could be subject to civil and criminal penalties, the FTC said.
"There's no way that the CEO can bury his head in the sand," James Kohm, head of the FTC's enforcement unit, told NPR. "There's no ostrich defense." According to FTC investigators, Facebook violated the terms of its 2011 settlement with the agency, in which it promised to protect user data from broad sharing with third-party apps. The company also committed new violations, they said. Kohm described two major incidents in which Facebook effectively lied to users. First, the company solicited phone numbers, saying they were being collected to verify users' identity if a password needed to be reset. Millions of people trusted the company, and then Facebook took those phone numbers and used them not just for security, but also for advertising purposes, the FTC said.
"There's no way that the CEO can bury his head in the sand," James Kohm, head of the FTC's enforcement unit, told NPR. "There's no ostrich defense." According to FTC investigators, Facebook violated the terms of its 2011 settlement with the agency, in which it promised to protect user data from broad sharing with third-party apps. The company also committed new violations, they said. Kohm described two major incidents in which Facebook effectively lied to users. First, the company solicited phone numbers, saying they were being collected to verify users' identity if a password needed to be reset. Millions of people trusted the company, and then Facebook took those phone numbers and used them not just for security, but also for advertising purposes, the FTC said.
Unless Zuckerberg faces the threat of prison time. (Score:3)
Unless Zuckerberg faces the threat of prison time, then he is not liable nor "personally answering".
Instead, his company will pay a fine, and he'll continue going on enriching his bank accounts in violation of the lay.
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The problem with that is when you take it too far. It makes no sense to prosecute the privates for blowing up a non-descript building they were ordered to blow up and not the generals who knew the building was an orphanage.
You need to make sure the people prosecuted for following orders knew or should have known, and be careful with how broadly you interpret should.
It may mean we need to add on additional penalties when leaders design the chain of command to keep people actually carrying out orders from kno
Re: Unless Zuckerberg faces the threat of prison t (Score:2)
"He won't face prison time because he's a member of the financial nobility."
FTFY
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Facebook isn't being penalized here for breaking any laws, they're being penalized for misleading people about what they would do with those peoples' personal information. That's basically a contract violation: civil, not criminal. (Note that penalizing them for collecting that inf
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Re: Unless Zuckerberg faces the threat of prison t (Score:2)
"We would need some kind of law protecting peoples' privacy"
Justice Louis Brandeis saw a positive, broad right to privacy in the Constitution way back in 1890.
He does (Score:2)
Criminal penalties mean jail time.
Time... is on my side... yes it is (Score:4, Informative)
Zuck: People just submitted it.
Zuck: I don't know why.
Zuck: They "trust me"
Zuck: Dumb fucks
"Personally answer" (Score:3)
Just so everyone is clear, "Personally Answer" is a legal term that is defined in US law to mean "to sit in chair at a table and have an index finger waved at for a time not to exceed for hours".
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Facebook went entirely too far, they were spying on the elite and the elite took offence. They liked Facebook spying on us nobodies but Facebook wanted more POWAH and for that the needed the secrets of the rich and greedy and well the rich and greedy noticed. Facebook can not be trusted but they want to keep the model of spying on us nobodies and manipulating us, without them being spied on and manipulated. As Facebook can not be trusted they have been actively curtailed but likely existing management is no
Ostrich defense? (Score:5, Informative)
"There's no way that the CEO can bury his head in the sand," James Kohm, head of the FTC's enforcement unit, told NPR. "There's no ostrich defense."
I thought that's quite literally why corporations had virtual personhood...to protect their executives from consequences for anything the company might engage in. Equifax just got away with a tiny monetary penalty for basically exposing everyone's credit information, and no one on the executive team is going anywhere or getting personally punished. Facebook is getting away with a similar small fine.
Not that it's right, but I think that's what corporations are set up for. On a micro level, if you're a sole proprietor and someone sues you for your entire net worth, they're entitled to all of it. If you're a corporation, the corporation goes bankrupt and starts all over again with a new name and fresh reputation. I'm aware of several small business owners around me who do this for tax avoidance purposes...they just bankrupt the company and move on when the heat gets too high.
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You are VERY wrong about the purpose of corporate liability limitation. Corporations are meant to protect the INVESTORS from the action of the EXECUTIVES. Not that it is a ton better but the idea is that a random facebook shareholder should not be personally liable for fines, jail time, etc for the actions of the EXECUTIVES that are actually in charge of making decisions. The executives are SUPPOSED to still be liable.
The real reason big time executives get off has nothing to do with corporations and appl
Re:Ostrich defense? (Score:4, Insightful)
I thought that's quite literally why corporations had virtual personhood...to protect their executives from consequences for anything the company might engage in.
No, you've got that wrong. Executives are personally answerable under many laws, and face jail time for some. Stockholders are shielded: they can only lose 100% of their investment.
None of which has a damn thing to do with "virtual personhood". The phrase you want is "limited liability". And you don't have to be a corporation to get limited liability, you can just set up a LLC. Heck, it's commonly done by individuals renting out a house.
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Sigh. [wikipedia.org]
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A common and understandable mistake. It's simply easier to pin a crime to the corporation as a whole; Pinning it to a particular person requires that you find a trail of evidence indicating that the specific person and no other is responsible, and that's often hard to do. But if you have the evidence, the fact that it happened in a corporation of
Re: Ostrich defense? (Score:2)
There are two issues with Equifax: their business model itself, and the lax security practices that led to the big data spill.
Equifax has an overtly evil business model. However that evil business model, which would be badly illegal under the old Common Law, is explicit authorized by a statutory badlaw. All decent people would like to see Equifax's executives called to account for their malignant influence on our republic. However we must recognize they are in fact complying with Duh Law.
The lax security p
So what? (Score:3)
Re: So what? (Score:2)
I wouldn't call the Department of Defense "private sector"...
I'll get you next time, Zuckerberg (Score:2)
Next tiiime!
Beginning now! (Score:2)
No, wait....beginning now!
Damn it, Zuck, again?
Ok; beginning now! ....
Pffffffff (Score:2)
Zuckerberg has made his billions.
The moment he becomes aware of the next privacy " scandal " about to drop, he'll simply retire and let the next guy deal with it.
The government can threaten all it wants but, those Golden Parachutes that get issued to CEO's are usually bullet proof.
Just the CEO? (Score:2)
What about the rest of the company's people? What if the CEO leaves the company?
Haha (Score:2)
How hypocritical. They finally find a CEO who isn't buddy-buddy with all the other CEOs so they set him up to take the guillotine for all of them.
Fucking American legal logic. Make a rule and apply it to one entity instead of applying it as a blanket rule to all entities. Fuck with people's privacy? Get $5 bn fine and personal liability. That's the end of this entire fucking debacle.
Sounds impressive until ... (Score:2)
... you realize any action by the FTC against Zuckerberg will be symbolic and nothing more than a lame half-hearted slap on the wrist purely for show. Like hitting one of the world's richest persons with a fine of ... (dramatic pause, place pinky finger at the side of the mouth [wikimedia.org]) ONE MILLION DOLLARS!!! Sorry about the all-caps, couldn't resist ...