TikTok was set to pay $1B in 2024 over kids privacy breaches – years before DOJs sweetheart $400M deal: sources | Latest Tech News
TikTok is nearing a $400 million truce with President Trump’s Justice Department over youngster data privacy breaches – a sweetheart deal as the social-media app was prepared to pay $1 billion to settle the same claims in 2024, The Post has discovered.
In June 2024, the Biden-era Federal Trade Commission disclosed it discovered evidence that TikTok had knowingly collected data on kids youthful than 13 without telling their dad and mom – a violation of a federal law called the Children’s Online Privacy Protection Act (COPPA).
Policymakers and online security advocates have long pushed for tightened restrictions on focused adverts, arguing social media corporations are manipulating impressionable kids and hooking them with addictive options to enhance their income.
TikTok was accused of violating a federal data privacy law called COPPA. AFP via Getty Images
TikTok executives – who at the time have been already preventing tooth-and-nail to stop a whole US ban of the app – have been keen to make the case go away. In closed-door negotiations with FTC officers during the spring of 2024, TikTok agreed in precept to pay a $1 billion settlement for the violations, three sources with direct data of the talks told The Post.
TikTok, the sources said, was also close to agreeing to other key security options sought by the FTC — including a ban on focused promoting for minors, limits on late-night notifications despatched to their telephones.
The FTC referred its findings and proposed settlement phrases to the Biden DOJ, taking the bizarre step of disclosing the referral in a press release, stating that it had “determined that doing so here is in the public interest.”
From there, the deal shortly fell aside.
Insiders said top officers at Biden’s DOJ have been hesitant to finalize a settlement, fearing that cutting a deal with a company or in any other case pursuing legal motion would undermine Congress’s lively effort to ban TikTok through laws.
The DOJ is reportedly close to a $400M settlement with TikTok. Christopher Sadowski
“It’s another example of how the Biden administration couldn’t get out of its own way,” said one of the sources with direct data of the state of affairs said.
Last week, ABC reported that the Trump administration was close to an settlement with TikTok to settle the DOJ lawsuit for about $400 million. The money is reportedly earmarked for “beautification” initiatives in Washington DC relatively than compensation for underage victims of data privacy violations.
The reported phrases drew a scathing response from Fairplay for Kids, a main online security advocacy group, which called the settlement a “a slap on the wrist that will not meaningfully change TikTok’s exploitation and harm of children.”
The $400 million determine quantities to “nothing more than pennies on the dollar” when the true scope of TikTok’s COPPA violations may have resulted in tens of billions in penalties, according to Fairplay.
“News reports about the settlement have not mentioned any meaningful injunctive relief,” Fairplay Policy Counsel Haley Hinkle said in a assertion.
The FTC discovered evidence that TikTok knowingly collected kids’ data without permission. Natalia – stock.adobe.com
“If that proves to be the case, it makes the settlement even weaker. The DOJ should have used the pressure of massive COPPA liability to extract meaningful changes to TikTok’s addictive and dangerous product design.”
The White House referred a request for remark to the DOJ.
“The Justice Department is committed to achieving resolutions that advance the President’s agenda, are grounded in the law and the facts, and protect taxpayer dollars,” a DOJ spokesperson said in a assertion.
TikTok didn’t reply to requests for remark.
The DOJ reluctantly filed a lawsuit against TikTok in August 2024, but made no point out of the settlement talks. The timing all but assured that the case wouldn’t be resolved until after that yr’s presidential election.
By then, President Trump had already vowed on the marketing campaign path to “save TikTok” if he was elected to the White House. The Trump administration later performed a key position in shaping the deal that allowed a US-majority entity to take over TikTok and avert a ban – with Vice President JD Vance even serving as level particular person of negotiations.
The White House’s direct involvement in those talks weakened the DOJ’s leverage in settlement talks and seemingly pushed TikTok to roll the cube on a more lenient consequence, sources said.
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