Trump and Facebook: Why are the HUD suing the social media giant and what were the 'discriminatory' ads?

'Using a computer to limit a person’s housing choices can be just as discriminatory as slamming a door in someone’s face'

The icon for the Facebook app shown on a smartphone screen in Moscow on 28 March 28, 2018 (AFP/Getty Images)

The Department of Housing and Urban Development (HUD) announced it is suing Facebook over alleged discrimination in the social media company’s advertising practices.

Although the HUD announced its lawsuit against the social media giant on Thursday, it filed a formal complaint against the Menlo Park company on August 13, 2018 in regards to Facebook’s alleged discriminatory advertising practices.

The agency said in a statement that Facebook’s advertising practices encouraged, enabled and caused “housing discrimination through the company’s advertising platform.”

The HUD’s charges against Facebook is based on how the social media giant “enabled advertisers to exclude people whom Facebook classified as parents; non-American-born; non-Christian; interested in accessibility; interested in Hispanic culture; or a wide variety of other interests that closely align with the Fair Housing Act’s protected classes.”

What is the Fair Housing Act?

The Fair Housing Act is federal law considered to be one of the pinnacles in the civil rights campaign championed by Martin Luther King Jr and signed into law one week after his assassination by former President Lyndon B Johnson.

The federal act protects buyers or renters from landlord discrimination based on seven protected classes: race, colour, religion, national origin, sex, familial status, and disability.

How is Facebook violating the Fair Housing Act?

HUD said in a statement that Facebook allowed “landlords and home sellers to use its advertising platform to engage in housing discrimination.” Secretary Ben Carson added that the social media company is discriminating against people based upon who they are and where they live” by allowing advertisers for housing and rental companies select who they can exclude from seeing their ads. The agency said through Facebook, advertisers were actively excluding people who identified as non-Christian, non-American-born, and individuals with disabilities among many other factors.

“Using a computer to limit a person’s housing choices can be just as discriminatory as slamming a door in someone’s face,” Mr Carson added.

Did Facebook make any changes in the past to prevent discriminatory practices by housing and credit advertisers?

The social media platform have made some recent strides aimed at preventing or curbing discrimination within their advertising systems. Last week, Facebook reached agreements with organisations like the National Fair Housing Alliance and the American Civil Liberties Union to remove age, gender and zip code targeting from housing, employment and credit advertisements, Yahoo! Finance reported. In August 2018, Facebook also removed thousands of targeting options to prevent advertisers from excluding, or discriminating, against audiences who fall within a certain demographic.

Did Facebook shares drop in result of the lawsuit?

Facebook shares fell 0.95% to $164.30 on Thursday morning, the Associated Press reported.

How did Facebook respond?

The social media company said in a statement to Yahoo! Finance on Thursday that it was “surprised by HUD’s decision, as we’ve been working with them to address their concerns and have taken significant steps to prevent ad discrimination.”

Adding, “while we were eager to find a solution, HUD insisted on access to sensitive information – like user data – without adequate safeguards. We’re disappointed by today’s developments, but we’ll continue working with civil rights experts on these issues.