The Federal Trade Commission has admitted a broad inquiry into Twitter’s privacy policies, following the release of a dozen letters from the agency to the business seeking information about its operations under new CEO Elon Musk on Tuesday.
A brief about FTC has announced that it is investigating Twitter’s privacy policies
The acknowledgement is a rare public admission of an investigation tied to suspected violations of an FTC settlement, which Twitter first signed in 2011, and was intended to push the business to enhance its user data protection. It also illustrates the tremendous scrutiny that both Twitter and its regulator are facing as officials try to identify whether violations of the settlement happened under Twitter’s new management, potentially increasing the company’s already massive legal liability.
The investigation might have significant ramifications for Twitter’s operations at a time when Musk is laying off employees and rushing out new paid features to offset severe losses in ad sales and boost the company’s bottom line. If confirmed, violations of Twitter’s consent order could result in billions of dollars in fines, new restrictions on Twitter’s operations, or even binding responsibilities for Musk or other officials.
Meanwhile, European regulators have frequently warned Musk of Twitter’s upcoming duties under the Digital Services Act, a new content moderation regulation that may result in fines of up to 6% of Twitter’s annual global revenue.
According to the staff report, the FTC letters sought testimony from Twitter about its staffing changes as a result of resignations and firings following Musk’s takeover of the firm. According to the report, the FTC inquired about Twitter’s selective dissemination of internal business data to independent journalists as part of the so-called Twitter Files, and sought that Twitter identify the journalists to whom Musk had disclosed sensitive Twitter material.
According to the story, the FTC also requested that Twitter disclose thousands of Slack messages relating to Musk, information about its Twitter Blue subscription scheme, and information about the office equipment it was allegedly selling as part of its cost-cutting initiatives. According to the article, the FTC requested more than 350 pieces of information in a dozen letters.
According to a staff report by a Republican-led House Judiciary subcommittee investigating the alleged “weaponization” of the US government, the FTC investigation is politically motivated and is being performed to “harass” Musk. (Musk courted and received support from a number of Republican members of Congress.) In response, the FTC stated in a statement that the investigation is consistent with both the agency’s goal and its specific legal role to enforce Twitter’s promises to protect users’ personal information.
“The FTC is designed to protect consumers’ privacy,” said agency spokesman Douglas Farrar. “It should come as no surprise that the commission’s career staff are undertaking a robust inquiry into Twitter’s compliance with a consent order that went into place long before Mr. Musk purchased the firm.”
According to the Wall Street Journal, which first reported the FTC letters and saw at least one of them, the FTC is demanding Musk’s deposition as part of the probe. Twitter, which has reduced its communications personnel, did not reply immediately to a request for comment.
Following the publication of the House subcommittee report this week, Musk rushed to Twitter to condemn the agency, calling its inquiry “a disgraceful case of weaponization of a government institution for political goals and suppression of the truth!”
Twitter’s consent agreement, signed in 2011, and revised in 2022 in response to other alleged infractions, mandates the company to maintain a sophisticated information security programme that safeguards user data. When Musk closed the acquisition last year, charges made by the company’s former head of security, Peiter “Mudge” Zatko, raised serious concerns about Twitter’s compliance with the deal.
Zatko claimed, as first reported by CNN and The Washington Post, that during his stint at Twitter, the firm allowed a large number of employees and engineers to make changes to Twitter’s live product and interact with real customer data without enough safeguards. He also said Twitter misled members of its board and regulators throughout the world about the health of its security. These allegations sparked a Senate inquiry and, as the FTC admitted this week, a formal investigation into whether Twitter violated its agreements.
For months, the FTC has signalled that it is closely monitoring Twitter’s behaviour. During a Senate hearing last year, FTC Commissioner Lina Khan told lawmakers that Twitter officials might be held personally liable if an inquiry shows that they assisted violations of an FTC consent decree. Khan did not reveal the existence of any such probe at the time. At the same time, the FTC stated that it was “watching recent developments at Twitter with profound concern” in light of claims that Twitter did not file privacy impact assessments relating to changes to its business and product under Musk.