EU Slaps X with $140M Fine for Misleading Blue Checks
▼ Summary
– The EU has fined X €120 million for violating the Digital Services Act, marking the first such penalty under this law.
– The fine specifically cites X’s deceptive blue checkmark system, which misleads users by allowing paid verification.
– The EU’s tech chief stated the DSA protects users and researchers, and this decision holds X accountable for undermining user rights.
– X must now propose fixes within 60-90 days to address the deceptive checkmarks and other violations, or face further penalties.
– A separate, ongoing investigation into X’s content moderation could lead to additional fines in the future.
The European Union has imposed a significant financial penalty on the social media platform X, issuing a fine of approximately $140 million for violations of the Digital Services Act (DSA). This landmark enforcement action, the first of its kind under the new regulations, centers on charges of deceptive user interface design and a lack of transparency. Regulators specifically targeted the platform’s revised verification system, arguing that its paid “blue checkmark” misleads users about account authenticity and undermines trust in the online environment.
According to the European Commission, X failed to comply with core DSA obligations concerning advertising transparency, data access for independent researchers, and the prohibition of so-called “dark patterns.” The “deceptive design” of the blue checkmark was a primary concern, with officials stating that allowing anyone to purchase verification makes it impossible for users to distinguish between legitimate, notable accounts and those who have simply paid a fee. The DSA does not mandate user verification, but it explicitly bans platforms from making false claims about verification status.
EU tech chief Henna Virkkunen emphasized the ruling’s broader significance in a statement. “Deceiving users with blue checkmarks, obscuring information on ads and shutting out researchers have no place online in the EU,” she said. “The DSA protects users. The DSA gives researchers the way to uncover potential threats. The DSA restores trust in the online environment. With the DSA’s first non-compliance decision, we are holding X responsible for undermining users’ rights and evading accountability.”
The fine represents a fraction of the potential maximum penalty, which could reach up to six percent of a company’s global annual revenue. As a privately held entity, X’s exact financial exposure remains unclear. The company, acquired by Elon Musk in 2022, now faces strict deadlines to rectify the cited violations. It has 60 working days to outline how it will change the use of blue checkmarks and 90 days to address the other compliance failures. Failure to meet these deadlines could trigger additional penalty payments, and X retains the right to appeal the decision in court.
Reports indicate European regulators carefully calibrated the fine’s size, aiming to set a strong precedent for other tech companies while navigating complex geopolitical tensions, including ongoing trade disputes with the United States. The decision follows a multifaceted investigation launched in December 2023, which remains active. That broader probe is examining X’s content moderation practices and the spread of illegal material on the platform, leaving the door open for further regulatory action and potential fines in the future.
(Source: The Verge)
