ICO Fine Facebook Half A Million Pounds

Facebook is to be fined £500,000, the maximum amount possible, for its part in the Cambridge Analytica scandal, the information commissioner has announced.

The fine is for two breaches of the Data Protection Act. The Information Commissioner’s Office (ICO) concluded that Facebook failed to safeguard its users’ information and that it failed to be transparent about how that data was harvested by others.

“Facebook has failed to provide the kind of protections they are required to under the Data Protection Act,” said Elizabeth Denham, the information commissioner. “Fines and prosecutions punish the bad actors, but my real goal is to effect change and restore trust and confidence in our democratic system.”

The sum is barely even a slap on the wrist for Facebook, which had revenues of more than $40 billion in 2017, but is the maximum possible under the applicable legislation.

Future violations will be able to be punished much more strictly, however: Under GDPR, the EU's new data protection legislation, companies can be fined up to €20 million or 4% of their global annual turnover, whichever is higher. (GDPR was not applicable because the offenses took place before it came into effect.)

In the first quarter of 2018, Facebook took £500,000 in revenue every five and a half minutes. Because of the timing of the breaches, the ICO said it was unable to levy the penalties introduced by the European General Data Protection (GDPR), which caps fines at the higher level of €20m (£17m) or 4% of global turnover – in Facebook’s case, $1.9bn (£1.4bn). The £500,000 cap was set by the Data Protection Act 1998.

Recently, Denham said: “This was a very serious contravention, so in the new regime they would face a much higher fine.”
Asked on BBC Radio 4’s Today programme if the fine now would amount to hundreds of millions of pounds, she said it “could”. Denham added: “This is not all about fines though … any company is worried about its reputation, because people want to feel that their data is safe. 

“In 2014 and 2015, the Facebook platform allowed an app … that ended up harvesting 87m profiles of users around the world that was then used by Cambridge Analytica in the 2016 presidential campaign and in the referendum.”

Facebook’s chief privacy Officer, Erin Egan, said of the intent to fine: “As we have said before, we should have done more to investigate claims about Cambridge Analytica and take action in 2015. We have been working closely with the ICO in their investigation of Cambridge Analytica, just as we have with authorities in the US and other countries. We’re reviewing the report and will respond to the ICO soon.” 

The inquiry, described by Denham as “the most important investigation that the ICO has ever undertaken”, has also resulted in warning letters being sent to 11 political parties, every UK party with an MP in the House of Commons as of March 2017, when the investigation began, and notices compelling them to agree to data protection audits.

It has led to a criminal prosecution of SCL Elections, Cambridge Analytica’s parent company, for failing to properly deal with the ICO’s enforcement notice, and an enforcement notice against the same for not replying to a subject access request from an American whose data it held. SCL Elections declared bankruptcy in May, two months after the Observer reported that 50m Facebook profiles had been obtained. Denham said the ICO was examining whether the company’s directors could be still be pursued now that SCL Elections had been placed into administration.

The investigation also found that Aggregate IQ, a Canadian electoral services company, had “significant links” to Cambridge Analytica, Denham said, and “may still retain” data about UK voters; the ICO has filed an enforcement notice against the company to stop processing that data.

How the story unfolded
In December 2016, while researching the US presidential election, Carole Cadwalladr came across data analytics company Cambridge Analytica, whose secretive manner and chequered track record belied its bland, academic-sounding name. Her initial investigations uncovered the role of US billionaire Robert Mercer in the US election campaign: his strategic “war” on mainstream media and his political campaign funding, some apparently linked to Brexit. 

She found the first indications that Cambridge Analytica might have used data processing methods that breached the Data Protection Act. That article prompted Britain’s Electoral Commission and the Information Commissioner’s Office to launch investigations whose remits include Cambridge Analytica’s use of data and its possible links to the EU referendum. These investigations are continuing, as is a wider ICO inquiry into the use of data in politics.

Cambridge Analytica is now the subject of special prosecutor Robert Mueller’s probing of the company’s role in Donald Trump’s presidential election campaign. Investigations in the UK remain live.

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