Even among all the other complaints about the social media networks, a new complaint from HUD stands out.
Facebook hasn’t exactly gotten much good press lately, especially given the user privacy issues revealed by the Cambridge Analytica scandal. But a new complaint against Facebook may drive public opinion about the social media network even further into a ditch. This month, the U.S. Department of Housing and Urban Development (HUD) filed a formal complaint against Facebook for violating the Fair Housing Act.
HUD says that Facebook has violated key principals of the Fair Housing Act by allowing advertisers to target specific groups. They say that Facebook’s platform that lets advertisers serve ads to specific groups creates an environment where discrimination can occur. In other words, ads targeted to homebuyers only get served to specific groups.
How does the Fair Housing Act limit discrimination?
The Fair Housing Act is a federal law that protects homebuyers and renters from discrimination. It states that Americans cannot be prohibited from buying a home or renting property based on:
- National origin
- Mental or physical disability
- Family status
This essentially means that you can’t be barred from owning or renting a particular home or condo or apartment just because you’re a single, African American female from the U.S Virgin Islands. Nothing about who you are as a person should limit the homes you have access to.
So, how does a social media network violate the Fair Housing Act?
It may seem odd that a social media network with no physical presence in the world that houses consumers can violate the Fair Housing Act. But it comes down to how Facebook’s advertising platform works.
Facebook allows corporate advertisers to narrow their audience based on all sorts of demographic factors. As a brand, you can decide you only want to advertise to females or people between the ages of 30-40. You can even choose demographics for religion, race, and ethnicity. This helps advertisers ensure that only people who really fit their brand see their ads. The system is designed to help advertisers avoid wasting money.
However, in practice, this advertising technology then also allows for built-in discrimination that violates the Fair Housing Act. A Realtor® or homebuying website or rental property can decide to only serve their ads to specific groups. In other words, they could essentially decide that their ads would only be seen by a certain race or gender or ethnicity. Thus, Facebook’s advertising system builds in the potential for fair housing discrimination against minorities.
Where does Facebook go from here to avoid fair housing discrimination?
This complaint came about after a consumer watchdog group name ProPublica purchased a series of ads for rental properties on the Facebook platform. They requested a variety of discriminatory exclusions. Basically, they told Facebook they didn’t want to serve their rental ads to “African Americans, mothers of high school kids, people interested in wheelchair ramps, Jews, expats of Argentina and Spanish speakers.”
All the ads from ProPublica were approved by Facebook without getting flagged as discriminatory. So, ProPublica took the findings to HUD. Now that HUD has filed a formal complaint, they will conduct a complete investigation. Facebook will have an opportunity to respond to the allegations. They can choose to voluntarily comply with changes to their ad platform to eliminate fair housing discrimination. If they don’t, then the case may get sent to the Department of Justice.
What should homebuyers take away from this?
“Homebuyers simply need to be aware that fair housing discrimination is illegal and that it happens more than you might think in 2018,” says Maria Gaitan, Housing Director for Consolidated Credit. “I don’t think Facebook set out to discriminate against minority homebuyers or violate the Fair Housing Act, but it’s a consequence of their goal to provide companies with the ability to target their advertising. And whether it’s intentional or unintentional, discrimination happens. Homebuyers need to be aware of it and understand that HUD offers consumers a way to lodge complaints if they believe they’ve encountered fair housing discrimination.”
On HUD’s website – hud.gov – there is a special portal that consumers can use to file a fair housing discrimination complaint. This allows homebuyers to lodge complaints if they believe someone is discriminating in housing decisions. This can include:
- Condo or homeowner’s associations
- Real estate brokers
- Online homebuying search tools
“Of course, homebuyers being discriminated against on Facebook wouldn’t know they’re facing fair housing discrimination,” explains Gaitan. “You simply won’t see the property sale or property rental ads that a different homebuyer may see. But this serves as a good lesson that homebuyers need to be in control of their homebuying process. You can’t just sit back and wait for the perfect property to land in your lap. You need to be proactive. Set up email alerts for properties you want and work with a Realtor® that understands your needs.”
Getting ready to buy a home? Consolidated Credit offers a HUD-certified homebuyer course that can make sure you’re prepared every step of the way.