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Facebook Could Face Up To $5 Billion Fine For Privacy Violations

Facebook CEO Mark Zuckerberg speaks during the Facebook F8 developers conference on May 1, 2018, in San Jose, Calif.
Justin Sullivan
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Facebook CEO Mark Zuckerberg speaks during the Facebook F8 developers conference on May 1, 2018, in San Jose, Calif.

Facebook expects to pay a fine of up to $5 billion in a settlement with federal regulators. The tech giant disclosed that figure in its first-quarter 2019 financial results.

Facebook has been in negotiations with the Federal Trade Commission following concerns that the company violated a 2011 consent decree. Back then, company leaders promised to give consumers "clear and prominent notice" when sharing their data with others and to get "express consent."

But, experts say, Facebook broke its promise. Just one example: giving user data to Cambridge Analytica, the political consulting firm that did work for the 2016 Trump campaign.

Facebook estimates the fine will be in the $3 billion to $5 billion range and has set aside $3 billion for payment. "The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome," the company's statement says.

This would not be the largest fine issued by the FTC. In 2016, the agency reached settlements with Volkswagen totaling up to $14.7 billion. Facebook's total revenue for the first quarter stood at more than $15 billion. So whatever the final figure, the company has the money to pay for the estimated fine.

Facebook's monthly active users stand at 2.38 billion, an increase of 8% year over year.

In an earnings call, CEO Mark Zuckerberg did not discuss the settlement in any detail. He focused his remarks on outlining Facebook's plans for growth, which include building a private messaging platform. He also pointed to the of privacy regulation as one that could work globally, if other countries chose to follow suit.

Copyright 2020 NPR. To see more, visit https://www.npr.org.

Aarti Shahani is a correspondent for NPR. Based in Silicon Valley, she covers the biggest companies on earth. She is also an author. Her first book, Here We Are: American Dreams, American Nightmares (out Oct. 1, 2019), is about the extreme ups and downs her family encountered as immigrants in the U.S. Before journalism, Shahani was a community organizer in her native New York City, helping prisoners and families facing deportation. Even if it looks like she keeps changing careers, she's always doing the same thing: telling stories that matter.