The US Federal Trade Commission (FTC) has approved a $5 billion penalty to be levied on Facebook to settle a probe into the social giant's privacy and data breaches surrounding it, The Wall Street Journal said on Friday.
According to WSJ, the Federal Trade Commission approved the settlement in a 3-2 vote, with the Republicans in support and Democrats in opposition to the penalty.
The deal which would be the largest penalty ever imposed by the FTC for privacy violations has been moved to the to the US Justice Department for review before it can be finalized.
Details of the settlement have not yet been released as it is still unclear what restrictions have been placed on Facebook's handling of user privacy.
"We don't yet know key aspects of the settlement: whether Facebook must make any changes to its business model and practice as a result," Charlotte Slaiman of the consumer group public knowledge said.
The FTC began to probe Facebook after the data breach scandal that involved British political consulting firm Cambridge Analytica (now defunct), which was accused of illegally accessing data of more than 87 million Facebook users without the regulator's consent.
The FTC probe was to determine whether Facebook's data sharing with the British firm violated a 2011 consent agreement between Facebook and the regulator.
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News of the settlement met wild cheers from investors which saw Facebook shares up 1.8% as several Democratic law makers in Washington condemned the proposed penalty as inadequate.
Rep David Cicilline,a Democrat and chair of a congressional antitrust panel called the $5 billion penalty "a Christmas present five months early."
"This fine is a fraction of Facebook's annual revenue. It won't make them think twice about their responsibility to protect user data," he said.
Facebook's revenue for the first quarter of 2019 was $15.1 billion while it had a net income of $2.43 billion. The social giant's income would have been more than that, but it set aside $3 billion for the FTC penalty.
Aside this, Facebook faces major headaches from the US president and several other groups which have criticised the social giant's planned launched of its cryptocurrency called Libra, over concerns of privacy and money laundering.
The FTC and Facebook all declined to comment on the story.