On July 24, 2019, the Federal Trade Commission (FTC) announced a $5 billion settlement with Facebook over violations of user privacy. The agreement, which marks the largest fine in FTC history, requires Facebook to make significant changes to its operations and practices.

The FTC`s investigation was sparked by revelations that Cambridge Analytica, a data analytics firm linked to Donald Trump`s 2016 presidential campaign, had improperly obtained data on tens of millions of Facebook users. The settlement focuses on Facebook`s failure to protect user data and misleading statements made to users about their privacy settings.

Under the agreement, Facebook is required to establish a new privacy committee on its board of directors to oversee the company`s privacy program. This committee will be appointed by an independent nominating committee and must have no fewer than three members. In addition, Facebook must create an independent privacy assessor, who will report to the new committee and be responsible for reviewing and reporting on Facebook`s privacy practices.

Aside from the new governance structure, the settlement also requires Facebook to implement a comprehensive privacy program and obtain regular, independent third-party assessments of its privacy practices. Facebook is also required to obtain affirmative express consent from users before sharing their data with any third party.

The settlement also mandates significant changes to Facebook`s data collection practices. Facebook must conduct a privacy review of every new or modified product, service, or practice before it is released, and must document any privacy risks and mitigation strategies. Facebook`s data retention policies must also be reviewed and updated to ensure that data is deleted within a reasonable timeframe.

The FTC agreement is not without its critics. Some privacy advocates argue that the $5 billion fine is not enough to deter Facebook or other tech companies from continuing to violate user privacy. Others feel that the agreement does not go far enough in holding Facebook accountable for its actions.

Regardless of its limitations, the FTC agreement represents an important step forward in protecting user privacy and ensuring that tech companies are held accountable for their actions. It sends a message to other companies that they must take user privacy seriously and that they will face consequences if they fail to do so.