Facebook goes under formal EU privacy scrutiny after latest massive data breach

Facebook engineer working at the company’s HQ, Menlo Park, CA (Copyright: Facebook Inc., Source: Facebook Inc.’s website, newsroom)

Facebook engineer working at the company’s HQ, Menlo Park, CA (Copyright: Facebook Inc., Source: Facebook Inc.’s website, newsroom)

Last week, the European Union has announced it has formally launched an investigation into a massive data breach that has recently made vulnerable millions of Facebook accounts. The Irish Data Protection Commission, which is Facebook’s lead privacy regulator in Europe, said last Wednesday that it will look into whether the US social media giant is fully compliant with the General Data Protection Regulation, which entered into force earlier this year. The formal EU investigation focuses on the worst data breach in Facebook’s history, which was discovered by its engineers a couple of weeks ago, and that gave hackers the ability to take over some 50 million users’ accounts. If found guilty, the probe can cost Facebook up to $1.63bn.

Background

On Tuesday September 24, Facebook engineers found a bug in the “View As” feature of the popular social media, which allows people to see what their own profile looks like to someone else. The bug reportedly allowed hackers to crack the users’ accounts and access information of nearly 50 million people, of which nearly the 10 per cent was coming from the EU. The Menlo Park, California-based company said it had immediately disabled the feature to then open an internal verification. The company has then subsequently announced the bug was patched on Thursday. Parallelly, more than 90 million users had to log out of their accounts as a result of the breach, something that has been described as an “additional precautionary measure” taken with potentially comprised accounts.

The EU’s investigation

Last week, the EU said it had commenced an investigation under section 110 of the Data Protection Act 2018 into the breach that was notified by the US company the week before. Facebook’s lead regulator in the European Union, the Irish Data Protection Commissioner (DPC), then announced last Wednesday it was going to offically assess whether the social media giant is still compliant with General Data Protection Regulation (GDPR) after the hacker attack that made the accounts of millions of users vulnerable. The Irish authority said it was formally going to determine whether Facebook had “appropriate technical and organizational measures” in place to protect its users’ personal data.

“The investigation will examine Facebook’s compliance with its obligation under the General Data Protection Regulation to implement appropriate technical and organisational measures to ensure the security and safeguarding of the personal data it processes,” the Commission said in a statement last week. The Spanish Data Protection Agency has reportedly said it would collaborate with the DPC on the probe “to protect the rights of Spanish citizens.”

Facebook’s reaction

The DPC has also said that Facebook had informed the Commission that their internal investigation is “continuing” and that the company “continues to take remedial actions to mitigate the potential risks to users”. The day Facebook unveiled the hacker attack, Mark Zuckerberg, Facebook Inc.’s President and CEO said: “While I’m glad we found this, fixed the vulnerability, and secured the accounts that may be at risk, the reality is we need to continue developing new tools to prevent this from happening in the first place”. Also, according to The Guardian, a Facebook spokesperson said: “We have been in close contact with the Irish Data Protection Commission since we have become aware of the security attack and will continue to cooperate with their investigation”.

Quite a year

The security breach is believed to be the largest in Facebook’s history, but it’s not the one and only issue the US internet giant is facing. The company has been under increasing pressure – especially in the EU – for the past 12 months. One of the biggest news of the year was indeed concerning a data analytics firm once employed by the Trump campaign, Cambridge Analytica, which had improperly gained access to personal data from millions of Facebook users’ profiles. It was revealed that that data belonging to as many as 87 million Facebook may have been used to get President Donald Trump elected.

When the scandal exploded, Facebook CEO Zuckerberg had to appear at congressional hearings to give proof of Facebook’s privacy practices. Facebook CEO admitted on September 28, when unveiling the massive data breach, that the company faces “constant attacks from people who want to take over accounts or steal information around the world”.

Under the Commission’s lens

Also, last week’s scandal came only a couple of weeks after the EU commissioner in charge of consumer protection, Věra Jourová, warned Facebook Inc. she had “run out of patience” with the social network after for being too slow in updating its terms of service covering what happens to user data and said that the company could face sanctions.

According to Bloomberg, Commissioner Jourová told reporters in Luxembourg late last week that the latest Facebook breach is the “first big test case” for GDPR. The EU Commissioner also twitted last week she had spoken on the phone with Helen Dixon from the DPC about the Facebook data breach, and that she welcome her decision “to launch the investigation to examine if Facebook complies with GDPR”. “I offered my full support in getting to the bottom of this story”, Jourová also said.

GDPR’s frame

The risk that Facebook may face for this latest, massive data breach could be very hefty. Under the new GDPR European privacy regulations which came into effect in May, breaking privacy laws can result in fines of up to 4 percent of global revenue or 20 million euros, whichever is higher, as opposed to a few hundred thousand euros under previous regulation. Facebook Inc. has made over $40.65 billion last year in revenue, and so the total fine could amount to around $1.63 billion.

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