Facebook Parent Settles Cambridge Analytica Data Harvesting Scandal For $725 Million
Facebook Parent Settles Cambridge Analytica Data Harvesting Scandal For $725 Million
BY TYLER DURDEN MONDAY, DEC 26, 2022 - 05:00 PM
Facebook parent Meta
has agreed to settle a class-action lawsuit over the Cambridge Analytica data
harvesting scandal for $725 million, or just under 2.5 days of revenue (based
on Q3 figures).
To recap - in 2014,
Aleksandr Kogan of Cambridge University in the UK built a Facebook app that
paid hundreds of thousands of users to take a psychological test. The
app harvested not only the data of the test-taker, but the data of their
Facebook friends as well. Kogan sold the resulting database of up
to 50 million Americans to Cambridge Analytica, which provided
analytical assistance to the 2016 presidential campaigns of Ted Cruz and Donald
Trump.
Facebook subsequently
banned Cambridge Analytica, and in October 2019 agreed to pay the UK a £500,000
fine for exposing user data to a "serious risk of harm."
The $725 million
settlement is the largest in a US data privacy class action, according to the BBC,
citing attorneys.
Meta said the
settlement was "in the best interest of our community and
shareholders," adding "We look forward to continuing to build
services people love and trust with privacy at the forefront."
As noted above, the
settlement is "not that much" to the tech giant, author James Bell
tells the BBC.
"It's less than a
tenth of what it spent on its efforts to create 'the metaverse' last year
alone," he said, adding "So Meta probably won't be too unhappy with
this deal, but it does stand as a warning to social media companies that
mistakes can prove very costly indeed."
The settlement is
subject to approval by a federal judge in San Francisco.
"This historic
settlement will provide meaningful relief to the class in this complex and
novel privacy case," said lead lawyers Derek Loeser and Lesley Weaver, in
a statement.
The complaint was filed on behalf of a large proposed class of
Facebook users, whose personal data
on the social network was released to third parties without their consent.
The class size is
"in the range of 250-280 million" people, according to the ruling document,
representing all Facebook users in the US during the "class period"
which runs from 24 May, 2007 to 22 December, 2022.
It is not clear how
the plaintiffs would claim their share of the settlement. -BBC
According to privacy and ethics researcher Janis Wong of the Alan Turing institute, the settlement would only amount to 'two or three dollars' per person if each affected individual submits a claim.
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