Facebook shares ended lower in the US Monday, in line with the broader stock sell-off and are currently in the red in after-hours activity, too. Meanwhile, the Seattle ethics and elections commission has accused the global tech firm of violating its city laws on political campaigning.
Facebook shares closed 4.74% lower at $181.26, Monday. That further decline comes as the US stock markets experienced a volatile session and ended sharply lower.
Facebook in breach of Seattle campaign law
The Seattle Ethics and Elections commission said Facebook has not followed a city law requiring information on who purchases election campaign ads. This is a new attempt to regulate online US political ads.
The prevalence and apparent influence of online advertising on social media sites, has come under close scrutiny since the US 2016 election, won by Donald Trump.
In 2017 there were a number of local elections in the city, including a mayoral campaign and two city council seats up for election. Seattle Ethics and Elections Commission’s executive director Wayne Barnett, said Facebook could face penalties if it doesn’t share details on political ad spending related to those events.
The financial penalties could be $5,000 per advertising purchase.
Facebook believes it has complied
Facebook, meanwhile, said it believed it had complied with Seattle new city law.
"Facebook is a strong supporter of transparency in political advertising," said Facebook’s vice president for state and local public policy, Will Castleberry. "In response to a request from the Seattle Ethics and Elections Commission, we were able to provide relevant information."
However, Barnett said the information Facebook disclosed wasn’t nearly detailed enough.
Barnett said Facebook’s response, a spreadsheet with some spending numbers, “doesn’t come close to meeting their public obligation.”
"We gave Facebook ample time to comply with the law," Barnett said. "I'll be discussing our next steps this week with the city attorney's office."