UPDATE: Facebook is turning off a feature of its digital ad-targeting tool that allows advertisers to exclude users whose behavior on the site identifies them with certain racial and ethnic groups, USA Today reported. The social media company said today that it will make the feature unavailable to advertisers posting housing- and employment-related promotions.

Dive Brief:

• A new report from the nonprofit investigative journalism outfit ProPublica suggests that Facebook’s option to target ads at users based on what the social media website calls "ethnic affinities" violates the Civil Rights Act of 1964 and the Fair Housing Act of 1968 because it lets companies target — or avoid targeting — advertisements at individuals based on race.
• Facebook’s ad-targeting capabilities, including the exclusion feature, are generally a boon to companies, who use it to reach niche audiences to yield a greater return than simply sending an advertisement to a general audience where the impact may not be as significant.
• The social media site does not ask users to identify their race but instead determines "ethnic affinities" based on data collected on how they use the site, such as pages liked or shared. Users can see how Facebook identifies their “ethnic affinity,” but instead of changing it, they can only opt-out of tracking, Fusion reported. 

Dive Insight:

To test the exclusionary function of Facebook’s ad-targeting, ProPublica reporters purchased an advertisement to be viewed by users that the social media site had identified as looking to buy a house, but they excluded users with African-American, Asian-American or Hispanic "ethnic affinities." The ad was approved by Facebook within 15 minutes.

When asked for comment, a Facebook official told ProPublica that its policies prevent users from utilizing the tool to discriminate and that it will "take prompt enforcement action" if it spots or is made aware of an ad that violates those policies.

In a Facebook post in response to the ProPublica investigation, the social media website’s head of U.S. multicultural sales, Christian Martinez, said that ad-targeting allows people to see advertisements that more accurately reflect their experience than do those seeking to reach a general audience. "This prevents audiences for community-specific ads from seeing a generic ad targeted to a large group and helps avoid the offensive outcome that traditional advertising can often create for people in the minority," he wrote.

The Fair Housing Act prevents individuals and organizations from refusing to sell or rent housing or provide related financing to an individual on the basis of race, color, nationality, sex, disability or whether they have children, according to the U.S. Department of Housing and Urban Development, and it requires the government to step in proactively in order to ensure housing availability. To promote the latter, HUD has released data on housing patterns to identify areas where new or improved housing policy could make an impact.