Meta Could Pay Millions In Fines For Campaign Finance Disclosure Law Violations

Meta Platforms Inc (Nasdaq: META) may be facing millions in fines as a King County Superior Court judge found that the company intentionally violated Washington state’s campaign finance disclosure law hundreds of times.

Passed by voters in 1972, the state’s campaign finance law, also known as the Fair Campaign Practices Act, requires sellers of political advertisements to maintain financial records and file and release them to the public in a timely manner. The disclosure should include the names and addresses of the person or entity that paid for the ad, the target audiences, and its total number of views.

In September, Judge Douglass North ruled that by failing to make the required disclosures, the social media giant had intentionally violated the law a total of 822 times. North determined that the violations were intentional because it was not the first time that Meta violated the law.

Meta was first sued by State Attorney General Bob Ferguson for violating the law in 2018. The company then agreed to pay a $238,500 fine, and rather than making the mandated disclosures, the company said that it would put a ban on political ads in the state. But the state found that the company continued to run political ads on the platform.

“Meta not only continued to solicit Washington Political Advertisements, but Meta was aware that its announced ‘ban’ would not, and did not, stop all such advertising from continuing to be displayed on its platform,” the judge wrote.

The company initially tried to have the case scrapped, arguing that it was unconstitutional and that it “unduly burdens political speech” and is “virtually impossible to fully comply with.”

The total amount of the fine has yet to be determined as of this writing, but each violation of the Fair Campaign Practices Act carries a possible $10,000 fine. This amount could triple if a judge rules the violation as intentional — Meta might end up paying almost $24.7 million.

Meta last traded at $127.82 on the Nasdaq.

Information for this briefing was found via the sources and companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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