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Timothy B. Lee

Timothy B. Lee

Timothy B. Lee covers technology policy, including copyright and patent law, telecom regulation, privacy, and free speech. He also writes about the economics of technology. He has previously written for Ars Technica and Forbes. You can follow him on Twitter or send him email.

Brian Fung

Brian Fung

Brian Fung covers technology for The Washington Post, focusing on electronic privacy, national security, digital politics and the Internet that binds it all together. He was previously the technology correspondent for National Journal and an associate editor at the Atlantic. His writing has also appeared in Foreign Policy, Talking Points Memo, the American Prospect and Nonprofit Quarterly. Follow Brian on Google+ .

Andrea Peterson

Andrea Peterson

Andrea Peterson covers technology policy for The Washington Post, with an emphasis on cybersecurity, consumer privacy, transparency, surveillance and open government. She also delves into the societal impacts of technology access and how innovation is intertwined with cultural development.

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Posted at 06:13 PM ET, 02/01/2012

Facebook warns investors more federal probes may come

Mark Zuckerberg, founder and chief executive officer of Facebook Inc. (Tony Avelar - BLOOMBERG)
In its filing for an initial public offering. Facebook on Wednesday warned of the potential for additional regulatory investigations that would adversely affect its growth.

In S-1 papers provided to the Securities and Exchange Commission, Facebook listed several regulatory and legal risks — such a privacy investigations, patent disputes, and any potential security breaches — that could force the company to change its business practices or pay hefty fines.

The social networking giant, with 845 million active global users, also warned that censorship of the site in other nations and European and other rules on privacy could harm its business.

“We have been subject to regulatory investigations and settlements and we expect to continue to be subject to such proceedings in the future, which could cause us to incur substantial costs or require us to change our business practices in a manner materially adverse to our business,” the company said in the filing.

Last November, Facebook settled an investigation with the Federal Trade Commission over claims it deceived consumers by overhauling its privacy policies in 2009 in a way that made user information more public.

The firm, which has beefed up its lobbying and policy operations in Washington, D.C. in the past year, listed several regulatory issues that directly affect its business. Those include user online privacy investigations and legislative proposals. The firm also noted risks associated with the proposals of new anti-piracy laws, and stronger protection of minors online.

And with an estimated 90 percent of the social networking market, it also listed “competition” as a issue investors should note. Analysts have pointed to Facebook, Apple, and Google as new targets of antitrust review because of Facebook’s dominance in social networks, Google’s dominance in search and Apple’s closed iTunes system.

“Violation of existing or future regulatory orders or consent decrees could subject us to substantial monetary fines and other penalties that could negatively affect our financial condition and results of operations,” the firm said.


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By  |  06:13 PM ET, 02/01/2012

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