The FTC again met criticism last week from Senate Democrats and Republicans after reports of an estimated $5 billion privacy settlement with Facebook. A former commissioner defended the agency's reported 3-2 decision, saying a more-stringent penalty was never guaranteed in court.
Karl Herchenroeder
Karl Herchenroeder, Associate Editor, is a technology policy journalist for publications including Communications Daily. Born in Rockville, Maryland, he joined the Warren Communications News staff in 2018. He began his journalism career in 2012 at the Aspen Times in Aspen, Colorado, where he covered city government. After that, he covered the nuclear industry for ExchangeMonitor in Washington. You can follow Herchenroeder on Twitter: @karlherk
A Senate Judiciary Committee task force led by Sen. Marsha Blackburn, R-Tenn., discussed privacy with Salesforce, Snap, Mozilla and Match representatives, a Blackburn aide confirmed Thursday. Blackburn will co-chair the task force with ranking member Dianne Feinstein, D-Calif., the aide said. There’s no end date for the group’s efforts, given ongoing issues for the tech industry, and members hope to meet again before the August recess, the aide said. Blackburn, Feinstein, Sen. Chris Coons, D-Del., and Sen. Richard Blumenthal, D-Conn., attended Thursday’s gathering with about 50 people, said the aide. Discussing the need for a new federal privacy law is “a good spot to start,” Blackburn told us, noting the task force is open to all committee members. Blackburn said on the Senate floor that the group will also explore antitrust, competition and any other issues that arise. She urged backing for her Browser Act (see 1904110052). Sen. Josh Hawley, R-Mo., told us his office is interested in participating. “I’m glad there is increasing interest,” he said. “I hope we will be moving toward some actual legislation.” Speaking on the Senate floor, Senate Majority Whip John Thune, R-S.D., reaffirmed his commitment to reaching bipartisan, federal privacy legislation that sets one standard across the U.S. Hawley noted there have been public calls to re-examine the tech industry’s content liability shield from Blumenthal and Sens. Lindsey Graham, R-S.C.; Mazie Hirono, D-Hawaii; and Ted Cruz, R-Texas, since he introduced legislation aimed at Section 230 of the Communications Decency Act.
The Senate Judiciary Committee unanimously advanced to the floor legislation that would establish a voluntary small claims board within the Copyright Office (see 1907110060). Groups including Public Knowledge and Center for Democracy & Technology remain opposed. They said it would subject internet users, who unknowingly violate copyright, to unfair fines up to $30,000.
Calibra head David Marcus on Wednesday avoided committing Facebook to a moratorium on its cryptocurrency plans (see 1907150051), despite repeated calls from House Financial Services Committee Democrats at a hearing. Afterward, Chairwoman Maxine Waters, D-Calif., told us Marcus would leave Capitol Hill understanding her committee is serious about blocking the project until concerns are resolved. “We have oversight responsibility, and we’re going to live up to our responsibility,” she said.
Facebook’s cryptocurrency project Libra provides more incentive for Congress to pass comprehensive privacy legislation, Senate Banking Committee Chairman Mike Crapo, R-Idaho, told reporters Tuesday, after testimony from Facebook Calibra Head David Marcus. The platform won’t offer Libra until it receives proper approvals from U.S. and foreign regulators, Marcus told the committee, as expected (see 1907150051). Libra’s goal is to offer a secure, safe and low-cost way for people to transfer money internationally, he said, arguing a U.S. company should lead the push.
Increased tech sector concentration is killing innovation, said House Antitrust Subcommittee Chairman David Cicilline, D-R.I. During Tuesday's hearing with Amazon, Apple, Facebook and Google, he cited examples of each company engaging in anticompetitive behavior to privilege their platforms. It was the second hearing on the topic since the House Judiciary Committee announced a bipartisan tech industry investigation (see 1906110072).
Facebook won’t offer its digital currency Libra until the company receives the “appropriate approvals” and all regulatory concerns are “fully addressed,” Calibra Head David Marcus is expected to tell the Senate Banking Committee Tuesday (see 1907050025). He anticipates the most “careful pre-launch oversight by regulators and central banks in FinTech’s history,” according to his prepared remarks. Facebook doesn’t expect Calibra, the subsidiary leading the project, to “make money at the outset.” The Libra Association, a 28-company group managing the project, doesn’t plan to compete with “any sovereign currencies,” he wrote. House Financial Services Committee Chair Maxine Waters, D-Calif., voiced concern about Libra competing with the dollar. The association “will work with the Federal Reserve and other central banks to make sure Libra does not compete with sovereign currencies or interfere with monetary policy,” Marcus said. If the U.S. doesn’t lead the digital currency market, foreign entities with far different values could take control, he wrote. The Treasury Department has “very serious concerns” about digital currencies like Libra being misused by money launderers and terrorism financiers, Secretary Steven Mnuchin said Monday, calling it a “national security issue.” Facebook will be subject to the same safeguard requirements as traditional financial institutions, he added. The platform's “dismal track record on data privacy makes its proposal to launch Libra a dangerous liability at home and abroad,” the Open Markets Institute said Monday. Congress and the Federal Reserve should block non-sovereign currencies like Libra and consider offering its own digital currency, the group said. The risks of Libra are “too great to allow the plan to proceed,” Public Citizen President Robert Weissman is expected to tell the committee. Libra raises questions that regulators aren’t prepared to address about national sovereignty, corporate power, consumer protection, competition policy, monetary policy and privacy, Public Citizen wrote.
It’s not legitimate to claim Silicon Valley is biased against conservatives, Rep. Ro Khanna, D-Calif., said in an interview on C-SPAN's The Communicators set to have been televised this weekend. President Donald Trump offered anecdotal evidence of social media’s anti-conservative bias at a White House summit Thursday (see 1907110066).
President Donald Trump offered anecdotal evidence of social media bias and alleged throttling of his followers and activity on Twitter. Speaking Thursday to hundreds of invitees at his Presidential Social Media Summit (see 1907100040), he cited dramatic fluctuations of follower counts and Twitter interaction. “It would be like a rocket ship when I put out a beauty,” he said, claiming nowadays it takes him 10 times as long to gain 100,000 followers.
The FTC should remain the U.S. privacy enforcer but needs more resources, House Consumer Protection Subcommittee ranking member Cathy McMorris Rodgers, R-Wash., told us Thursday. Two House Democrats from California are contemplating draft legislation that would replace it with a new data privacy agency. A prospective privacy bill will need bipartisan, bicameral support to pass, she said after an appearance at a U.S. Chamber of Commerce event.