SEC Fines $100M Facebook on Disclosing Data Risk
WASHINGTON (AP) – Facebook will pay a $100 million fine to the Securities and Exchange Commission to settle charges it made misleading disclosures about the risk of misuse of Facebook user data.
The SEC says Facebook presented misuse of data as a hypothetical for two years even though it knew third-party developer Cambridge Analytica had actually misused user data.
The settlement is on top of the $5 billion settlement announced Wednesday with the FTC over privacy violations.
Facebook is not admitting the allegations as part of either case.
The SEC says Facebook discovered the misuse in 2015 but did not correct its existing disclosure for more than two years. When the company disclosed the incident in March 2018 its stock price dropped.