Instagram faces $402M fine for alleged mishandling of children’s data

Instagram faces $402M fine for alleged mishandling of children’s data

Parent company Meta plans to appeal the decision by the Irish Data Protection Commissioner, which is the second-largest, privacy-based fine on record.

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The Irish Data Protection Commissioner will fine Instagram $402 million for allegedly mishandling the personal data of children, specifically through default settings that left phone numbers and email addresses for users between the ages of 13 and 17 exposed via Instagram business accounts, according to published reports.

It’s the second-largest fine ever handed out by EU-based regulators, behind only the $739 million that Luxembourg authorities levied against Amazon last year. A spokesperson for the Irish DPC said that full details on the decision will be published next week, according to the reports.

The decision stems from a 2019 study by data protection scientist David Stier, who found that a large part of the 60 million Instagram users who were under 18 at the time changed their personal accounts into business accounts, in order to gain insight into view numbers for particular posts and numbers of personal profile views, according to the Washington Post.

By default, those business accounts made email and phone numbers available publicly. Instagram has since updated its privacy settings, and said that it had “engaged fully” with the Irish DPC’s investigation, though it disagreed with the way the fine was calculated and stated that it plans to appeal.

More regulatory actions on privacy expected

According to Rob Shavell, co-founder and CEO of online privacy protection firm DeleteMe, companies should expect further regulatory action in the future, unless their privacy systems are already functioning at a particularly high level. 

Trust and control over personally identifiable information are both at a premium in the current era, and the popular conception of shadowy cybercriminals being most responsible for invasions of privacy is rarely accurate.

“This is not a classic data breach, this is information exposed by wilful neglect of preferences and settings and things like that that leaves the door open for information like this to leak out to anyone,” he said. 

“Businesses, particularly if they have any customers in California, should be concerned that California regulators [are close to implementing] regulations that basically mirror the data protection acts in European countries.”

Both data brokers and holders of personally identifiable information (PII) should be concerned about the coming wave of regulation, noted Shavell. And PII holders, specifically, should be aware that the major threat to their customer data isn’t a malicious attack by hackers, but a simple configuration mistake that allows data to be scraped from the web and sold by brokers.

“Are you exposing the data about the customer in ways that they don’t want, or in ways that could have negative ramifications for their privacy rights?” he urged businesses to ask themselves. “Every organisation has to think about a different kind of data breach that could result in a huge fine or real harm to the organisation.”

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