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The Man Deciding Facebook’s Fate


The Man Deciding Facebook’s Fate

Joseph J. Simons, the chairman of the Federal Trade Commission, is a lawyer who has focused on antitrust regulation for most of his career.CreditCreditAndré Chung for The New York Times

WASHINGTON — The Federal Trade Commission has no shortage of critics who say it cannot protect Americans from the prying eyes of Big Tech. Instead of forceful action against the likes of Facebook and Google, they say, the F.T.C. leans on a rules that make it hard to impose penalties bigger than rounding errors for the companies.

Those critics have an unusual champion: Joseph J. Simons, the man running the agency.

“We have this over 100-year-old statute that is our main authority,” Mr. Simons said in his first sit-down interview since becoming chairman 10 months ago. “And clearly legislators who approved that were not thinking about data security and privacy issues.”

In the deregulatory era of the Trump administration, Mr. Simons, 60, a Republican lawyer who has jumped between the public and private sectors for more than 30 years, is a rare voice for strengthening the government’s hand.

Mr. Simons has urged Congress to expand the F.T.C.’s privacy-enforcement powers and allow it to impose fines more easily, write new rules and hire more experts. He also says the agency should police how all companies and nonprofits — not just technology companies — collect and handle people’s digital data.

But none of those changes will happen before Mr. Simons must make the most anticipated decision on data privacy in the agency’s history. In the coming weeks, he and the F.T.C.’s four other commissioners are expected to conclude an investigation into whether Facebook violated its promises to protect people’s data.

The outcome of the case is seen as a referendum on the government’s ability to rein in tech giants that have amassed incredible wealth and power from collecting and bartering user data.

“The F.T.C.’s decision on Facebook will be highly consequential, for the F.T.C. and Facebook, for the tech industry, and for consumers,” said David Vladeck, who led consumer protection at the agency during the Obama administration. “The commission’s action will set the bar.”

The case has taken on huge significance in Washington, where Facebook has become Exhibit A for an industry accused of a wide range of problems, from enabling foreign election interference to crushing competitors.

A rising chorus of Republican and Democratic lawmakers has criticized the F.T.C. for not restraining the companies’ data-collection practices, which are central to some of their businesses. The agency’s biggest penalty on a tech company was a $ 22 million fine imposed on Google in 2012, for misrepresenting how it used some online tracking tools. Google reported $ 50 billion in revenue that year.

On Friday, Senator Elizabeth Warren, the Massachusetts Democrat who is running for president, announced a sweeping plan to strengthen regulations against big tech companies.

“The F.T.C. has been a disappointment with its lack of enforcement in the past, which for Facebook and Google has amounted to a slap on the wrist,” Senator Josh Hawley, a freshman Republican from Missouri, said in an interview. Mr. Hawley investigated Google for competition violations when he was a state attorney general.

The Facebook investigation is focused on whether the social network violated a 2011 consent decree in which it promised to protect user data and inform users of changes in how their data was used. The inquiry started last March under Mr. Simons’s Republican predecessor, Maureen Ohlhausen, after a report in The New York Times revealed that the political consulting firm Cambridge Analytica had analyzed the data of 87 million users without their permission.

The agency is considering imposing a multibillion-dollar fine on Facebook as well as new requirements to strengthen protections on how data is collected and shared, according to two people close to talks between the agency and the company. The two sides have discussed a possible settlement for weeks, said the people, who spoke on the condition of anonymity because the investigation is continuing.

Facebook declined to comment about Mr. Simons and the investigation. The social network has defended its actions, saying that when it learned a researcher violated its terms of service by giving user data to Cambridge Analytica, it demanded that the data be destroyed and was promised that it had been.

On Wednesday, the company announced plans to shift to a more privacy-focused platform. Mark Zuckerberg, the company’s chief executive, said Facebook would invest in encrypted communications and refashion its messaging tools to emphasize private conversations.

Mr. Simons and his agency’s four other commissioners are investigating whether Facebook violated its promises to protect personal data.CreditT.J. Kirkpatrick for The New York Times

Mr. Simons declined to discuss the Facebook case. And he was even guarded about his own use of technology. He would not say whether he used Facebook or two other popular apps owned by the company, Instagram and WhatsApp. He doesn’t use other social media like Twitter, he said; aides write the tweets from his official F.T.C. account.

“I don’t even know how to access my account,” Mr. Simons said.

His comfort zone is antitrust regulation, a major focus for the F.T.C. and an area in which he has worked for most of his career. In his meticulous office, Mr. Simons keeps handy a worn Yale Law Journal with red plastic tabs on antitrust articles. He has had six of its authors speak at the F.T.C. since he arrived.

In one of his first actions as chairman, he held hearings on updating merger reviews and antitrust enforcement in the digital age. In late February, he announced a task force of 17 antitrust staff members to study potential problems that could arise from past tech mergers.

“In antitrust, you want to focus on areas where there is likely to be market power or monopoly power,” Mr. Simons said. “So it is not unreasonable to look at big digital platforms and say, well, that might be an ripe area to look at.”

He is new to the world of data privacy and admits he is cramming to understand it, immersing himself in articles and grilling staff about data protection. But that, he said, allows him to bring a “fresh perspective” to privacy enforcement.

“I am willing to look at everything with a fresh eye, and to question long-held beliefs and assumptions,” he said.

The F.T.C. monitors whether companies like Google, Uber and Facebook break promises written into privacy policies. But it can’t directly fine a company for a first-time offense; it can only charge a company with deceptive or unfair business practices, which the agency must prove in court. The potential penalty against Facebook could reach billions of dollars because the case hinges on whether it violated a previous settlement.

Mr. Simons argues that the agency needs more direct authority to oversee privacy practices and fine companies. He says it is too hard to prove to a court that someone has been harmed by a company’s unauthorized use of their data.

“It’s important that we get civil penalty authority,” he said. “For companies that have lots of money, the impact would be sufficient to deter them.”

Privacy groups say the agency has missed numerous opportunities to punish companies with its existing powers. Many compare the commission with European regulators, which have levied hefty fines on Google, Facebook, Amazon and Apple for violating antitrust, privacy, tax and security laws.

Some privacy advocates are also concerned about Mr. Simon’s inexperience in the area, saying it requires a deep understanding of complicated technologies.

“I don’t think he understands the dimensions and implications underlying the consumer privacy threat,” said Jeffrey Chester, executive director of the Center for Digital Democracy, a nonprofit consumer advocacy group.

Mr. Simons said there were obvious differences between how the United States and Europe viewed privacy.

“The E.U. has this strong sense of the right to be forgotten,” he said. “We don’t have that. We have the opposite of that. We have the First Amendment.”

And he said the details of how the government handled digital privacy should be for lawmakers, not him, to sort out.

“Privacy involves very important societal and cultural values that really need to be determined by the Congress,” Mr. Simons said, pointing toward Capitol Hill, less than a mile up Pennsylvania Avenue from his office.

“Not,” he said, “by unelected F.T.C. commissioners.”


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