Mark Zuckerberg, chief executive officer and founder of Facebook Inc., speaks to the media during an event at the company’s headquarters in Menlo Park, California, U.S. (Photographer: David Paul Morris/Bloomberg *** Local Caption *** Mark Zuckerberg)

Facebook, Google Pay to Settle State Political Campaign Ad Probe

(Bloomberg) -- Facebook Inc. and Google will pay Washington state a combined $455,000 to settle allegations that they skirted transparency rules for election campaign advertising, one of the first such fines against the Silicon Valley giants amid growing scrutiny of their influence on U.S. elections.

Washington’s attorney general accused the companies in a June lawsuit of failing to document about $6 million in political advertising on their sites dating back to 2013. The settlements aren’t an admission of wrongdoing, according to filings in state court in Seattle.

Facebook and Alphabet Inc.’s Google have faced increasing criticism over their roles in elections since it was revealed two years ago that Russian agents used their social networks to meddle in the U.S. election. On Monday, the Senate released two reports it commissioned that showed Russia’s activity was even broader than previously known, and criticized the tech companies for not acting fast enough to combat the threat.

One campaign finance watchdog said $400,000 is a relatively large penalty for a violation.

“This is really one of the front lines of campaign finance disclosure,” said Pete Quist, research director at the National Institute on Money in Politics in Helena, Montana. “Online media is playing an increasing roll in political spending, and some states are looking for ways to be more proactive to demonstrate that their older laws still apply to new kinds of advertising.”

The companies allegedly didn’t maintain records about who purchased an ad, how much it cost, when it ran online and the names of candidates or issues supported. Washington Attorney General Bob Ferguson’s complaint cited multiple instances of the companies’ failure to provide information upon request, including one from a Seattle-based newspaper in 2017 related to a municipal election.

The state accused the companies of violating its 1972 campaign finance law, which provides the public rights to visit advertisers during business hours to request and review documents related to electoral ad spending.

”Whether you are a small-town newspaper or a large corporation, Washington’s political advertising disclosure laws apply to everyone,” Ferguson said in a statement.

Google said it was in compliance with Washington laws until the state introduced new requirements under its campaign disclosure law in June, prompting the company to pause election advertising in the state. Google is trying to bring to the state level several features rolled out this year to ensure transparency in U.S. federal elections, a spokeswoman said.

Facebook said it, too, is working hard to protect election integrity and is glad to resolve the Washington case.

“We believe all ads should be transparent on Facebook and aren’t waiting for legislation to authorize political advertisers and house these ads in a public archive,” said Beth Gautier, a company spokeswoman.

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