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FTC Wants to Appoint an “Assessor” to Oversee Privacy at Facebook

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Facebook just wrapped up its F8 conference for the year, but that in itself won’t necessarily undo all of its troubles. In fact, Mark Zuckerberg’s power at Facebook is being questioned at the moment. For those of you who don’t know, Mark Zuckerberg is a one-stop-shop when it comes to power at Facebook. Zuckerberg is the CEO, chairman, and controlling shareholder. And now, that authority is being questioned in a way that it never has before, as part of a legal settlement. It’s never my intention to wish ill on Facebook, but they haven’t been giving me a reason to feel otherwise. Especially after what happened with the Cambridge Analytica scandal. Maybe people shouldn’t have “allowed” Facebook to access their information, but Facebook definitely needs to take the lion’s share of that blame for not being transparent.

That said, the Federal Trade Commission has been investigating the massive Cambridge Analytica scandal, where the personal information of 87 million Facebook users was used in the 2016 presidential election. And the work that the FTC is doing is finally coming to a head. Facebook revealed, last week, that they had set aside $3 billion in order to settle the probe into their data handling practices.

The New York Times and Politico report that Facebook wont’ be getting off that easy. In fact, Facebook and the FTC are discussing a number of new privacy safeguards, which include:

  • Facebook appointing an FTC-approved privacy official or “assessor”. This “assessor” will monitor whether it is complying with the FTC settlement and acting in the best interests of users.
  • Creating an “independent” privacy oversight committee to keep Facebook in check. This could be made up of Facebook board members and other experts, according to the reports. It will meet quarterly, sources added.
  • Appointing Zuckerberg or another Facebook executive as a “compliance” officer. Theoretically, this would make them personally accountable for any future data breaches.

By doing these things, the FTC is essentially eroding Zuckerberg’s authority in a way that is quite unprecedented. He would have independent experts looking over his shoulder, checking on the work that he’s doing, holding him accountable for his mistakes and making sure that users are actually being protected. The fact that this is needed looks really bad for Zuckerberg. I mean, essentially the FTC is giving him a babysitter. He had many opportunities to put a stop to the shady business practices that he’s been employing for the last couple of years, and yet he couldn’t (or didn’t) and now a staff member from the FTC is going to be breathing down his neck.

What’s interesting is that some of Facebook’s more activist shareholders have tried to force Facebook into appointing an independent chairman, but they have been strongly opposed to the idea and always voted it down. This will certainly give unhappy investors another attempt to get rid of Zuckerberg as chairman during their meeting at the end of May. They might also want to rip up the firm’s share structure in order to dilute his voting power. Of course, Facebook is pushing back on this plan saying that an independent chairperson would “cause inefficiency in board and management function and relations”. But that’s not true. The truth is, this is something that has been needed for a really long time and Zuckerberg is just going to have to get used to his new babysitters.