Facebook is already facing charges from the Department of Housing and Urban Development that the social media giant enabled real estate companies to unlawfully discriminate against users by choosing who could view their ads based on race, nationality, religion, color, familial status, sex and disability, but that’s not the only trouble the site is facing.
New York Gov. Andrew Cuomo announced this week that he has asked the New York Department of Financial Services to begin investigating Facebook and whether the site allowed housing providers to discriminate against prospective residents from protected classes.
“According to reports, Facebook’s advertising platform allows advertisers to modify or block ads using ZIP code information to exclude consumers based on race, color, national origin, religion, familial status, sex and disability, among other classifications,” Cuomo’s office stated in a release.
“Facebook touts its advertising platform as a powerful means for housing and housing-related advertisers to reach desired consumers,” Cuomo’s office continued. “In addition to the specific tools made available to advertisers, Facebook also allegedly uses machine learning and predictive analytics to categorize users to project each user's likely response to a given ad, which may recreate groupings defined by their protected class.”
And now, one of the most powerful state financial regulators will be looking into Facebook’s advertising practices as well.
“The allegations against Facebook advertisers are extremely troubling and fly in the face of everything that New York stands for,” Cuomo said in a statement. “I am calling on the Department of Financial Services to investigate these claims and help ensure that New Yorkers seeking housing for themselves and their families are not discriminated against in any way. We will take aggressive action and ensure that those who are behind these reprehensible alleged practices are held fully accountable.”
Last year, HUD took action against Facebook, claiming that the site’s advertising platform allowed property owners to discriminate against prospective renters and buyers based on their race, color, religion, sex, familial status, national origin, disability, or other factors, all of which are protected classes under the Fair Housing Act.
After HUD filed its complaint against Facebook, the site announced that it was removing more than 5,000 ad target options to “help prevent misuse.”
But before Facebook announced those changes, several fair housing and civil rights groups including the American Civil Liberties Union sued Facebook, claiming that the site still allowed ads to discriminate against protected groups, including women, veterans with disabilities and single mothers.
That lawsuit was later settled. As part of that settlement, Facebook announced that it would be making significant changes to the way it handles ads for housing, lending, and employment, including prohibiting advertisers from targeting housing, employment, or credit ads by age, gender or ZIP code.
Despite those changes, HUD still formally charged Facebook with violating the Fair Housing Act, and now the NYDFS is investigating Facebook too.
“DFS is committed to ensuring that all New Yorkers are protected and not discriminated against, no matter whether they’re engaging in social media apps or simply opening a bank account,” NYDFS Superintendent Linda Lacewell said. “The Department will investigate Facebook advertisers to examine these disturbing allegations and we are prepared to take whatever measures necessary to make certain that all financial services providers are in compliance with New York’s stringent statutory and regulatory consumer protections.”
When asked about New York launching its investigation, a Facebook spokesperson directed HousingWire to a civil rights audit, which the site released this week.
In that document, Facebook Chief Operating Officer Sheryl Sandberg noted the changes the company is already making to its ad platform.
“Our ads tools help businesses reach people all over the world and we need to make sure they aren’t misused. In March 2019, we announced historic settlement agreements with leading civil rights organizations to change how US housing, employment and credit ads are run on Facebook,” Sandberg said.
“Our policies have always prohibited advertisers from using our tools to discriminate. In 2018, we went further by removing thousands of categories from targeting related to protected classes such as race, ethnicity, sexual orientation and religion,” Sandberg continued.
“But we can do better. As a result of the settlement, we’re rolling out updates so anyone who wants to run US housing, employment and credit ads will no longer be allowed to target by age, gender or zip code and will have a much smaller set of targeting categories overall,” Sandberg said.
“We’re building ways to make sure advertisers follow these rules with plans for full enforcement by the end of the year. We will also have a tool where you can search for and view current US housing ads by advertiser and location, regardless of whether the ads are shown to you,” Sandberg added.
“We’re committed to going beyond the settlement agreement to let people search US employment and credit ads on Facebook too,” Sandberg concluded. “These ads are crucial to helping people buy homes, find jobs, and gain access to credit — and it’s important that everyone on Facebook has access to these opportunities.”
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