The latest revelations about how Facebook Inc. shared user data could put pressure on the Federal Trade Commission, heightening the risk of a multibillion-dollar fine for the social media giant.
Facebook, bound by a 2011 settlement with the FTC, isn't supposed to share private data without the permission of users or misrepresent its privacy policies. But a New York Times report earlier this week said Facebook shared users' private messages and allowed access to data about friends without their consent. Those are "two potentially thorny legal problems," according to Matthew Schettenhelm, a Bloomberg Intelligence litigation analyst.
"Political pressure on the FTC is significant here. Not all of the allegations against Facebook are violations, but there's a real possibility that some of them are," Schettenhelm said in an interview. "And it doesn't take many violations of the consent decree when you multiply it by how many users Facebook has for the FTC to get to a significant penalty."