SAN FRANCISCO — Facebook advertisers can exclude specific racial and ethnic groups when placing housing ads in potential violation of federal anti-discrimination housing laws, according to a Pro Publica report.
Using a designation called "Ethnic Affinities," Facebook lets advertisers target and exclude certain groups of Facebook users when placing ads for a new apartment or a house for sale. Pro Publica says it placed an ad for a housing-related event that excluded African Americans, Asian Americans, and Hispanics.
Facebook says it bans advertisers from using "Ethnic Affinities" to discriminate against racial or ethnic groups.
Facebook generates nearly all of its revenue from advertising. Key to its success: letting advertisers target very specific audiences by tapping into the extraordinary amount of data Facebook collects on its 1.71 billion users which it supplements with information purchased from data brokers. Facebook says its users cannot identify their race or ethnicity on Facebook. Affinity targeting is based on interests they have declared or Facebook pages they have liked.
Multicultural targeting is designed to make advertising more relevant and inclusive to diverse communities, Christian Martinez, head of multicultural at Facebook, said in a blog post.
"Advertising should empower you to learn about things that are relevant to you, that speak to you, that reflect you and your community. It’s also empowering to see content that validates your community as one worth reaching," Martinez wrote.
Multicultural ad targeting is not illegal and, in fact, is pretty common in the industry. It can help marketers reach demographics most interested in certain products or services, said Joseph Turow, a professor who researches Internet marketing at the University of Pennsylvania's Annenberg School for Communication.
"But it's really tough to find bad actors, especially when you are allowing millions of people to buy their own ads on Facebook," Turow said.
Danny Sullivan, founding editor of Search Engine Land, agrees. "Racial ad targeting has the potential for abuse and has the potential for great help, both for businesses and consumers," he said. But Facebook should give housing and employment ads a greater degree of scrutiny, he said.
Rigel Oliveri, a professor of law at the University of Missouri who researches fair housing and online advertising, says the practice raises "serious legal problems" when it comes to housing.
"There's a part of the Fair Housing Act that makes it illegal to have discriminatory advertising. That part applies to both the person taking out the ad and also the publisher of that ad," Oliveri said.
Online services such as Craigslist have successfully argued they are legally protected by the Communications Decency Act against liability for discriminatory housing ads posted by users. But, Oliveri said, "what Facebook is doing here is different."
"It's not just hosting the ad. It's encouraging and providing the advertisers with the ability to exclude people based on their race and ethnicity," she said.
University of Connecticut law professor Jon Bauer says if Facebook allows housing ads to be targeted in a way that excludes racial and ethnic groups, "they are clearly violating the Fair Housing Act of 1968." The same would hold true for other areas covered by civil rights legislation such as employment, Bauer said.
According to the Fair Housing Act of 1968, it's illegal "to make, print, or publish, or cause to be made, printed, or published any notice, statement, or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on race, color, religion, sex, handicap, familial status, or national origin."
No online service should permit the targeting of housing products and services based on race, says Stacy E. Seicshnaydre, a fair housing and anti-discrimination expert and law professor at Tulane University.
"Given the history of residential segregation, where black communities were isolated and cut off from commercial investments, loans, insurance, and other high-quality goods and services while being targeted for exploitive and predatory financial services, this kind of 'cyber redlining' is unacceptable," Seicshnaydre said.
UCLA information studies professor Safiya Umoja Noble says the advertising industry excluded ethnic consumers for decades, giving rise to African American, Latino, women's and eventually LGBTQ agencies to develop campaigns to target those consumers.
Facebook is helping marketers "place advertising in front of the audiences its customers want to reach," Noble says. "General market advertising is about reaching a mass audience, and ethnic advertising is intended to include those who may not be reached."
What's troubling to Noble: "Facebook has a technological, algorithmically-driven decision-making tool that is allowing for what is clearly a discriminatory, anti-black, anti-people of color ad to be approved and posted."
"Whites-only advertising has been a real and unfortunate legacy of the advertising industry, and algorithms are not sophisticated enough to remedy this," Noble said. "Indeed, as we have seen, it is likely to bring it back."