The Netherlands fines Clearview AI $33.7 million for its illegal facial recognition database

On September 3, 2024, the Dutch data protection regulator fined facial recognition startup Clearview AI 30.5 million euros (about $33.7 million). The reason is that the company created an "illegal database" containing billions of facial photos. The Dutch Data Protection Authority (DPA) also warned Dutch companies to refrain from using Clearview's services.

The data agency said that Clearview did not object to this decision and therefore cannot appeal. But Jack Malkel, Clearview's chief legal officer, said in a statement that the decision is "illegal, lacks due process and is unenforceable", and claimed that Clearview is not bound by EU data protection regulations because it has no business locations, customers or activities subject to GDPR in the Netherlands or the EU.

The Dutch Data Protection Authority said that creating this database without adequately informing people whose images appear in the database is a serious violation of the EU's General Data Protection Regulation (GDPR). Aleid Wolfsen, director of the data protection authority, pointed out that facial recognition is a highly intrusive technology and cannot be used casually. If there are photos online, they may enter Clearview's database and be tracked. If Clearview does not stop its illegal activities, in addition to fines, it will face a penalty of up to 5.1 million euros (5.6 million dollars) for violations.

In June this year, Clearview reached a settlement in a lawsuit in Illinois that alleged its massive collection of facial photos violated privacy rights. Lawyers estimate that the settlement could be worth more than $50 million. As part of the settlement, Clearview did not admit any liability. The company scrapes photos from social media and other places on the internet to create a database and sells it to businesses, individuals and government entities.