Meta, the parent company of Facebook, has been hit with another substantial privacy penalty in Europe, as Ireland’s Data Protection Commission (DPC) announced a fine of €91 million (approximately $101.5 million) following a lengthy investigation into a 2019 security breach.
Details of the Investigation
The DPC launched a statutory inquiry in April 2019 after Meta reported that “hundreds of millions” of users' passwords were stored in plaintext on its servers. This incident raised significant concerns under the General Data Protection Regulation (GDPR), which mandates the secure handling of personal data.
Upon investigation, the DPC found that Meta did not meet the GDPR's standards for data protection. The lack of encryption for user passwords created a substantial risk, allowing potential third-party access to sensitive information stored on the social media platform.
Breach Notification Failures
In addition to the security failures, the DPC noted that Meta failed to notify the regulatory body within the required timeframe. GDPR stipulates that breaches must be reported no later than 72 hours after being discovered. The DPC also indicated that Meta did not adequately document the breach, further compounding its legal challenges.
Deputy Commissioner Graham Doyle emphasized the seriousness of the violation, stating, “It is widely accepted that user passwords should not be stored in plaintext, considering the risks of abuse that arise from persons accessing such data.”
Meta's Response to the Fine
In a statement, Meta spokesperson Matthew Pollard downplayed the findings, describing the incident as an “error” in password management. He stated that the company took “immediate action” to rectify the situation and asserted that there was no evidence that the exposed passwords were misused. Meta also claimed to have proactively notified the DPC about the issue and engaged constructively during the inquiry.
Repeated Violations and Previous Fines
This latest fine adds to Meta’s growing list of GDPR penalties, underscoring ongoing challenges with privacy compliance. Notably, the €91 million fine is significantly higher than the €17 million penalty the DPC imposed in March 2022 for a separate 2018 security breach. The latest incident affected potentially hundreds of millions of users, illustrating the severity of Meta's oversight in protecting user data.
The GDPR allows for penalties based on several factors, including the nature and duration of the infringement and the number of individuals affected. While the €91 million penalty may seem significant, it represents a small fraction of Meta’s financial capacity, given its annual revenue of $134.90 billion in 2023.
Conclusion
As Meta navigates the complexities of data privacy regulations in Europe, this recent €91 million fine serves as a reminder of the critical importance of safeguarding user information. With growing scrutiny and potential financial consequences, Meta must prioritize robust data protection measures to comply with GDPR standards and restore user trust.
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