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Facebook pays SEC $100 million following allegations

| Oct 31, 2019 | Firm News, Uncategorized |

Facebook pays SEC $100 million following allegations

If you’re not skeptical of Facebook and what they do with your data, you should be.

On July 24, 2019 Facebook agreed to pay $100 million to the U.S. Securities and Exchange Commission for misleading users on the risk of misuse of Facebook user data.

The charges stem from Cambridge Analytica, an analytics company that collected data from Facebook in 2014 and 2015 to “create personality scores for approximately 30 million Americans.” Cambridge Analytica collected names, genders, locations, birthdays and even pages that users liked. The company then used this data to create political advertising, according to the SEC.

In 2015, Facebook told investors that “our users’ data may be improperly accessed, used or disclosed.” An SEC complaint alleges Facebook denied Cambridge Analytica used Facebook user data, telling news reporters that it found no evidence of wrongdoing. Facebook eventually did disclose a breach in data in 2018 notes the SEC.

“As alleged in our complaint, Facebook presented the risk of misuse of user data as hypothetical when they knew user data had in face been misused,” said Stephanie Avakian, co-director of the SEC’s Enforcement Division. “Public companies must have procedures in place to make accurate disclosures about material business risks.”

Facebook did not admit or deny the SEC’s allegations.

The Spencer Law Firm’s attorneys litigate FINRA related proceedings such as FINRA arbitration and enforcement actions.  If you have any questions regarding FINRA or if you have a FINRA arbitration or enforcement action and need assistance, please feel free to call Bonnie Spencer at the Spencer Law Firm at (888)237-459 to see what we can do for you. You can also visit us at Spencer-Law.com or at our office at 4635 Southwest Freeway, Suite 900, Houston, Texas, 77027.