The market cares. It had already priced in a fine, possibly one larger than 3B. The reduction in uncertainty -- knowing the magnitude of the fine -- also positively affects the stock price. If the fine were cancelled tomorrow, you can be sure that, all else equal, Facebook's market cap would jump by 3B.

The fines need to be bigger.

They need to increase the fine substantially for each repeated violation. After a few violations its going to be hard to justify a $50B fine to investors.

The fines also needs to be fair, not fixed cost. I think the EU has got the percentage-of-revenue approach right. A million dollar fine for a small company can be death-sentence while for a big player it is lose change, that is not fair.

I agree that percent of revenue is a much better metric to base these kinds of fines off of, but not without reservations -- a small company with high sales revenue but razor thin margin could get killed by a % revenue fine; this seems unfair to the little guy.

On the other hand, if the fine is % income or anything but % gross receipts, then of course the system will be gamed endlessly by accountants and lawyers to show the smallest possible net number. The end result might be worse than a fixed fine. So % of revenue it is.

> So % of revenue it is.

GDPR, 4% of Global revenue and your Directors can be barred from operating in the EU.

Totally agree, at the third time there is really no excuse anymore to not bump this up to maybe even threaten the existence of an organization or it changes its behavior.

For FB this is the nth time. I don't even know what n is anymore.

Neither do any of the regulators...

No, they need to adjust the first-time penalties for deterrence. $50B at a minimum, because it has to hurt their stock price when they do these things. Or hey, how about a year of revenue.

The fines should be 100 billion. Make them itch a little.

Yes. The fine needs to take into account how much Facebook would stand to lose if the case went to trial and they were found guilty, setting a precedent for future actions against them. That seems like it could result in near-unlimited liability for Facebook. The fine for avoiding an admission of wrongdoing should be set equal to the expected value of all that liability, based on an estimate of the probability of winning the case.

There's no way the government has the same resources as Facebook to make that case. The FTC loses when it goes to Court. Facebook would have more lawyers on the case than the FTC has paralegals total.

And that guarantees victory? Interesting judicial system you have, over there.

Where is that fundamentally different in other countries for very large (especially domestic) players?

Will Germany actually take a swing at Volkswagen? Will Germany try to go after those that defrauded the government with cum-ex-trades?

Everybody vs banks regarding the Libor scandal? Sure, they paid some fines, but the fines were far below the damage done, and it appears to still have been a good investment for the banks, that is: all in all they made money, fines included.

Crime does pay at that level.

That's not something US specific, I believe.

I was referring to the fact that you can outpay your opponent.

Yes, large corporations can get away with much more in other countries as well, but rarely by outpaying their opponents.

Disagree. The money is very important to creating and maintaining the position they sit in.

Personally I think monetary fines are a fundamentally flawed form of punishment. Send. Decisionmakers. To. Prison. I don't care if it's for just a single day but march them into a courthouse in an orange jumpsuit and handcuffs.

This. Whether jail or some other sanction, hold decision makers personally accountable. Fines have their place, but - at least for a firm of FB's size - they just get priced into accounts.

The FB/Zuckerberg combination is almost unique in terms of (1) market cap, (2) the controlling ownership he holds, and (3) behaviour of the firm.

Facebook is reputedly pedalling furiously behind the scenes to prevent Zuckerberg himself being charged. Whilst saying almost nothing about the fines. That says everything about where they see the real danger.

Did they commit any crime?

I do agree that fines are overused, but I don't think there's reason for sending anybody to prison on this case.

Why is Facebook anticipating a five billion dollar fine if they didn't break any laws?

Breaking laws is not the same as comiting crimes.

No matter how the market reacts 3 billions is still 3 billion. People need to stop trying to look for justice in the market trends, investors are not pricing facebook based on how much cash they have in the vault right this instance, and if a verdict comes in below expectations the price is bound to rise.

Could you imagine the absurdity of them passing down a verdict of “and they shall be fined a billion per month until their stock price falls by at least 10%!”

The purpose of the fine is to discourage FB from engaging in illegal and unethical behavior. The problem here is that FB sees a $3B fine as the cost of doing business, since they surely made much, much more than $3B engaging in these invasive, user-hostile tactics. If they know that regulators will only come after them for an arbitrarily low percentage of revenue generated from these activities, why would they stop doing them?

If a punishment no longer deters bad behavior, then it's no longer a punishment.

I think the point is that we need to punish companies like Facebook in ways that might actually incentivize them to behave differently. If they get slapped with a fine that they can easily pay and then see their stock price go up, what's the point?

What laws have they broken? Without laws to break there isn't much justification for punishment.

Theft of personal information seems the most obvious one that they could be charged with. Unauthorized access of email accounts and exfiltration of information is something hackers have gone to jail for.

The Computer Fraud and Abuse Act (CFAA) prohibits accessing a computer without authorization, or in excess of authorization.

Facebook have broken a huge list of laws. But recently from my reading I think the current issue is a breach of contract. They signed a legal contract with the FTC and then broke it, hence the fine.

There doesn't seem to be any debate that Facebook broke the law - just debate about what the punishments should be.

Is it a coincidence that the stock price would move on the day when FB releases earnings?

Not just execs, I hope. The engineers who wrote the code and managers who told them to do it should also face justice.

Interesting point, at first it sounded a bit harsh but thinking a bit about this.... in the end as software engineers we are the ones pulling the trigger and your statement highlights our ethical responsibilities.

The problem though is that software engineering doesnt require any licensing requirements, etc. so one can always refer to incompetence being the problem (ooops a bug) and might get away with it.

Well, unlike other lowly developers, FB engineers know exactly what is and isn't the right kind of mistake to make in pursuit of a company's vision.

Someone who works at FB even came out and said so:

"Remember, what Facebook is doing has never been done before. There are going to be mistakes."

https://news.ycombinator.com/item?id=19321420

So yeah, I think what that person is saying should be translated as:

"Please don't think twice about punishing rank-and-file FB engineers. We are so competent, all our mistakes have only been intentional ones."

Have you never committed a bug before?

> A Facebook spokesperson said before May 2016, it offered an option to verify a user's account using their email password and voluntarily upload their contacts at the same time. However, they said, the company changed the feature, and the text informing users that their contacts would be uploaded was deleted — but the underlying functionality was not.

I doubt it was an engineer who deliberately removed the text but kept the contact import functionality.

> Have you never committed a bug before?

Engineers who make mistakes that harm people are still responsible for the mistakes they made. You cannot just claim "it was a bug" and get off scot free if your code harms someone or otherwise breaks the law. Also there's no need for this sarcastic tone, "have you never..?"

> I doubt it was an engineer who deliberately removed the text but kept the contact import functionality.

Why would you doubt that? I personally think that situation sounds quite likely. But either way we're just speculating.

Also, don't ignore the part of the parent comment that discusses the manager's (and implied other decision markers) that result in the decision being made to make an illegal change to the code.

Engineer, or manager, or QA assistant - someone or some group of people will have made the change. And "oops that was a bug" doesn't count. Corporations and their employees must be held to the same laws and standards to which the rest of us are held. "Ooops I didn't mean to do that" doesn't fly as an excuse to break the law.

I agree, but with conditions. PEs have ethical responsibilities. If the engineers are licensed, yup, they absolutely have a moral and legal responsibility to refuse to sign off on illegal work. In most states though, software engineers are not professionally licensed, certified, or ethically trained. Often they are referred to using demeaning terms such as "coders", which are equated as "bricklayers" by thought leaders such as Steve McConnell and others. Thus it would not necessarily be reasonable to hold them to a responsibility refuse to follow illegal orders they were given as mindless "bricklayers" and "coders" etc, which is the most common paradigm of software engineers. Unintelligent implementors who are simply typing things up on command with a surfeit of semicolons can not be held to any sort of professional responsibility. But PEs absolutely can and must.

That would require all developers to become lawyers so they can make sure everything they are being asked to do is legal.

Are you saying that we can only expect lawyers to follow the law? I have no legal training, yet I manage to avoid breaking the law every day. Why are developers special here?

We don't all need to be lawyers to understand the basics of our laws. Knowledge of the existence of the law is assumed for all citizens. Ignorance of the law has never been a valid excuse when the law is broken.

(Yes, the US does have some new problems with private laws being passed, where the public is not allowed to know the law itself - and this opens up huge scary things. But that is not what is being discussed here and I don't believe is relevant.)

What's wrong with introspection about what you're doing on an ethical level? There's no legal standard involved so you don't have to be a lawyer, just a bit more thoughtful.

The law isn't just ethics. Companies have whole legal teams because laws are so complex. Should a developer be responsible because the cookie banner they implemented wasn't compliant with the laws of 100 countries even though the legal team already told them it was ok?

> Should a developer be responsible because the cookie banner they implemented wasn't compliant with the laws of 100 countries even though the legal team already told them it was ok?

Yes. 100%. "I was just following orders" is not a valid excuse, ever - Nuremberg is the obvious extreme example, but it's true everywhere.

In fact, "I was just following orders" often is a valid excuse. It didn't work at Nuremberg because it was an extreme example. The orders there were to do things that could not even conceivably be legal, so those who carried them out were considered to have knowingly acted illegally.

When the orders are to do something that is plausibly legal, and you have good reason to believe that it is in fact so, "I was just following orders" will probably work in most jurisdictions.

Iff they have confirmation from their product lead that what they're doing is perfectly legal and it isn't obviously illegal, I agree that there's no liability.

If it's either obviously illegal or it's clearly at least dodgy and they didn't get explicit confirmation from the project lead, "following orders" is not a valid excuse.

To take the VW case as an example: if your project lead tells you to implement a way to recognise test conditions and adjust the performance to reduce emissions, that is dodgy af and you should at least get confirmation that this isn't illegal (i.e. that it's not intended to cheat on certifications but maybe just for certain internal testing scenarios). In the end the entire chain of command that led to this being implemented is guilty, but if the person implementing that behavior knew what they were doing was illegal or at least suspect and they didn't get confirmation, they're still guilty.

None of what Facebook has done here sounds plausibly legal to me. I'm not a lawyer, but this stuff is plain-as-day immoral and illegal from my eyes.

So a developer should not trust a huge legal team, who's purpose it is to verify all is legal?

How do you expect the developer to figure out its illegal when a team of lawyers couldnt?

My point is if you err on the side of ethics you likely would never need to worry about the law. I am fully confident the vast majority of people can determine when they're doing something unethical. I am not saying people will not undertake actions they know to be unethical, but avoiding unethical actions will protect that person from exposure to legal liability.

This is a ridiculous example because it equates clearly immoral and possibly illegal actions with legal trivia (because a hypothetical country may simply require a certain wording for compliance and it's trivial to mess that up).

Facebook claims to "value privacy" (and some devs have even told me that they value it "more than any other company") but their actions consistently show either neglect or outright abuse.

Should a developer be punished for implementing something illegal that the legal team signed off on and that wasn't obvious illegal? No, because the legal team is supposed to take the responsibility and if it wasn't obviously illegal the developer had no reason to assume the legal team was lying.

Should a developer be punished for implementing something obviously illegal even when the higher ups say "don't worry about it"? Yes. If your boss tells you to rob a bank, you still go to prison for bank robbery.

For everything in between: whistle blowing is a thing. If you suspect something fishy is going on, document everything, raise concerns and report what is happening.

Also if you are a well-paid employee in a position where you can easily find another job in the industry, speak up to your superiors and refuse to be complicit. Organise.

You really think execs will see consequences (besides fines)?