FTC Investigating Facebook

Well, I bet a bunch of people in Facebook HQ are saying “oh noes” right now because the news is out that the FTC is investigating Facebook according a statement put out by Tom Pahl, Acting Director of the FTC:

“The FTC is firmly and fully committed to using all of its tools to protect the privacy of consumers. Foremost among these tools is enforcement action against companies that fail to honor their privacy promises, including to comply with Privacy Shield, or that engage in unfair acts that cause substantial injury to consumers in violation of the FTC Act. Companies who have settled previous FTC actions must also comply with FTC order provisions imposing privacy and data security requirements. Accordingly, the FTC takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook. Today, the FTC is confirming that it has an open non-public investigation into these practices.”

Facebook stock which was already in free fall because of this data breach scandal promptly cratered as per this image:

fb.JPG

This is not the worst case scenario for the company. But it’s pretty darn close. The FTC doesn’t fool around which implies that Facebook is in a world of hurt because the FTC can force Facebook to radically change the way they do business or face all sorts of untold pain and suffering. Either way, it could be an extinction level event for the company.

Stay tuned. This is about to get interesting.

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