Twitter has been ordered to pay $150 million after a joint lawsuit filed by the Federal Trade Commission and the Department of Justice accused the company of giving advertisers access to users’ contact information without their knowledge.
With the approval of a federal court, the suit will also require the social-media giant to institute “robust compliance measures to protect users’ data privacy,” the DOJ announced in a Wednesday press release.
“The government alleges that Twitter violated the FTC Act and the 2011 order by deceiving users about the extent to which Twitter maintained and protected the security and privacy of users’ nonpublic contact information,” the release continued. “Specifically, the complaint alleges that, from May 2013 to September 2019, Twitter told its users that it was collecting their telephone numbers and email addresses for account-security purposes, but failed to disclose that it also would use that information to help companies send targeted advertisements to consumers.”
FTC Chair Lina M. Khan noted that Twitter collects “private” information such as phone numbers and email addresses under the “pretext” of using it to protect users’ accounts. However, the company also sold that information to targeted advertisers, a violation of an order issued by the FTC in 2011 regarding Twitter’s transparency about how nonpublic contact information is used.
“This practice affected more than 140 million Twitter users, while boosting Twitter’s primary source of revenue,” added Khan.
In addition to the civil penalty, Twitter has also agreed to implement several new measures to improve its privacy practices. Those measures include developing a new privacy and information security program; conducting a privacy review of any new services and products that collect private information; and performing routine maintenance checks on their privacy protections. An independent third party will also oversee privacy and security reviews, and other “numerous reporting and record-keeping requirements” have been ordered as well.
Elon Musk, who is in the midst of purchasing Twitter, has not yet commented on the settlement. Earlier today, he pledged $6.25 billion in equity commitments to the takeover bid, which now totals at $33.5 billion in funding. It is unclear whether he had knowledge of the lawsuit when he proposed the deal.