HUD Charges Facebook with Fair Housing Violations

On March 27, 2019, the Department of Housing & Urban Development (HUD) formally charged Facebook with violating the Fair Housing Act by encouraging, enabling, and causing housing discrimination through the company’s advertising platform.

The action follows HUD’s investigation of complaints against Facebook that began in August 2018. HUD alleges that Facebook unlawfully discriminates based on race, color, national origin, religion, familial status, sex, and disability by restricting who can view housing-related ads on Facebook’s platform and across the Internet. Further, HUD claims that Facebook mines extensive data about its users and then uses that data to determine which of its users can view housing related ads based, in part, on the protected characteristics.

According to HUD’s charge, Facebook enables advertisers to exclude people that 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 protected classes of the Fair Housing Act (FHA). HUD is also charging that Facebook enabled advertisers to exclude people based on where they live by drawing a red line around those neighborhoods on a map and to show ads to only men or only to women.

The charge further asserts that Facebook also uses the protected characteristics of people to determine who will view ads regardless of whether an advertiser wants to reach a broad or narrow audience. HUD claims Facebook combines data it collects about user attributes and behavior with data it obtains about user behavior on other websites and in the non-digital world. Facebook then uses machine learning and other prediction techniques to classify and group users to project each user’s likely response to a given ad, and in doing so, may recreate groupings defined by their protected characteristics. The Charge concludes that by grouping users who have similar attributes and behaviors (unrelated to housing) and presuming a shared interest or disinterest in housing-related advertisements, Facebook’s mechanisms function just like an advertiser who intentionally targets or excludes users based on their characteristics.

HUD’s charge will be heard by an Administrative Law Judge unless any party to the charge elects to have the case heard in federal court.

This is an important case and may well impact how other Internet platforms such as Google and Twitter operate in the future.