The Federal Trade Commission has said that Zoom Video Communications must apply a new information security program as part of its recommended settlement with United States regulators concerning user privacy issues.

There were no financial obligations mentioned in the resolution, but FTC warned that Zoom would face fines not exceeding $43,280 for each future violation under the settlement.

Zoom’s misleading claims

According to the agency, Zoom misled users by claiming that it gave them a secure communication channel while at the same time providing a lower level of protection. This gave the users a false sense of security.

“Zoom’s security practices didn’t line up with its promises,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection.

Zoom’s stock, which increased sharply this year, skidded more than thirteen percent in afternoon trading, to $433.

According to the company spokeswoman, the user’s security is Zoom’s top priority. She noted that they have solved the concerns identified by FTC.

How the settlement was reached

It was through voting where FTC voted 3-2 along party lines to pass the settlement. However, Rohit Chopra, a Democratic commissioner, issued a dissenting statement arguing that Zoom’s failures needed serious action.

Mr. Chopra noted that FTC’s proposed agreement didn’t include any help for the parties affected or any other meaningful accountability. He further stated that the agency’s orders didn’t include fact or liability findings, and therefore there were no significant conclusions of the investigation.

The Covid-19 pandemic benefited Zoom significantly, with millions of employees and students relying on its video platform as they study and work remotely. This saw its user base rise from10 million in Dec 2019 to 300 million in April 2020.

Zoom’s problem began when it failed to disclose that its service wasn’t fully end-to-end encrypted. Zoom has promised to come up with tools that will enable meeting hosts to have more control and users to participate securely.

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