Report: FTC to Accuse Facebook of Using 2FA Numbers for Ads, Hiding Facial Recognition Settings

Photo: Alex Brandon (AP)

The Federal Trade Commission recently attracted scorn from congressional Democrats for fining world-spanning social network Facebook just $5 billion rather than tens of billions after the company failed to abide by the terms of a 2011 settlement with the agency on user privacy. But the FTC still has more dirt to dish out from its 16-month investigation into the company’s privacy practices, per a Tuesday report in the Washington Post.

Two sources “familiar with the matter” told the Post that the FTC is preparing accuse Facebook of collecting phone numbers from users under the pretext of security and then allowing advertisers to use that information for ad targeting, as well as trying to hide settings allowing users to opt out of its facial-recognition database.

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The first matter relates to a 2018 study from Northeastern University and Princeton University researchers that found when users gave Facebook their phone numbers to set up two-factor authentication, which helps prevent unauthorized access to accounts, Facebook then used the info to pad out its trove of data usable for advertising purposes. In the second, the Post wrote, the FTC plans to accuse Facebook of providing insufficient information to approximately 30 million users “about their ability to turn off a [facial-recognition] tool that would identify and offer tag suggestions for photos.” Earlier this year, Consumer Reports reported that some Facebook users had their ability to turn off the feature relegated to a seemingly unrelated “Tag Suggestions” setting.

Both of the allegations are slated to be announced on Wednesday, the Post’s sources said, and will be included in a complaint tied to the $5 billion settlement between the FTC and Facebook. As the Post noted, this is a strong hint that given the choice between penalizing Facebook further for the “litany of privacy scandals” that have emerged since the FTC began its investigation and giving it “a clean slate going forward,” the agency has chosen the latter.

That settlement is expected to be officially announced on Wednesday; three sources told the Post that it will not require Facebook to admit any wrongdoing, while two told the paper the FTC did not actually bother to question CEO Mark Zuckerberg directly over the course of the investigation. Other reporting from the New York Times has indicated that Facebook will agree to stricter oversight of how it collects user data in the settlement, but “none of the conditions in the settlement will impose strict limitations on Facebook’s ability to collect and share data with third parties.”

[Washington Post]

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Tom McKay

"... An upperclassman who had been researching terrorist groups online." - Washington Post