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Facebook under fire from privacy watchdogs over 'Sponsored Stories' ads

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SAN FRANCISCO -- Privacy watchdogs are asking federal regulators to block proposed changes to Facebook policies that they say would allow the company to use the names and images of its nearly 1.2 billion users without their consent to endorse products in ads.

In a letter to the Federal Trade Commission on Wednesday, the Electronic Privacy Information Center and five other consumer groups said the changes would permit Facebook "to routinely use the images and names of Facebook users for commercial advertising without their consent."

Facebook insists that it is not changing its policies, just clarifying the language in them.

"We have not changed our ads practices or policies – we only made things clearer for people who use our service," Facebook said in an email.

In an interview last week, Facebook's chief privacy officer, Erin Egan, insisted "none of this has changed."

"All we are changing is that we are providing more information and more specifics," she said. "We are not changing how (it) works."

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Facebook added the proposed new language in response to a $20-million settlement of a 2011 lawsuit that alleged the company used personal information for commercial purposes without consent or compensation.

The current langauge says users have the right to control how their names, likeness and personal information are used for commercial purposes. The new language says users automatically give Facebook the right to use their information unless they deny the company permission to use it.

Privacy watchdogs are also taking issue with Facebook for not doing enough to protect children's privacy. The proposed changes say that any user younger than 18 essentially agrees that his or her parents or legal guardians have agreed to Facebook's terms on their behalf.

"Such 'deemed consent' eviscerates any meaningful limits over the commercial exploitation of the images and names of young Facebook users," the letter to the FTC reads.

Comments by Facebook users to the proposed changes have been largely negative on the official page where they were announced. Comments are the only way to protest the proposed changes. Facebook no longer allows users to cast their votes against proposed changes.

Changes to its privacy policies over the years led to a flood of complaints from consumers concerned over how Facebook handles their personal information. Facebook also reached a settlement with the FTC in 2011 over allegations it violated users' privacy when it changed default settings to make more of their information public.

With growing public concern over online privacy and more aggressive enforcement from regulators, it seems unlikely that Facebook would make a move that would risk violating its settlement with the FTC.

"The FTC needs to open an investigation and make a public determination as to whether the change in privacy policy complies with the 2011," said Marc Rotenberg, executive director of the Electronic Privacy Information Center, or EPIC. "Groups such as EPIC are prepared to litigate if the FTC fails to enforce its order that we all worked to put in place."

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