TikTok Scores $400 Million DOJ Settlement After Offering $1 Billion Under Biden
The Justice Department finalizes a $400 million settlement with TikTok over child privacy violations, redirecting funds to Washington beautification projects instead of compensating young victims.
The Trump Justice Department is finalizing a $400 million settlement with TikTok over child privacy violations, less than half the $1 billion the Chinese-owned platform offered during the Biden administration. The deal channels those funds into Washington D.C. beautification projects rather than compensating young victims, underscoring how political maneuvering in both parties consistently sidelines child safety.
In spring 2024, TikTok proposed paying $1 billion and implementing safety measures, including a ban on targeted advertising to minors, according to three sources with direct knowledge of the Federal Trade Commission negotiations. The Biden Justice Department hesitated to finalize that agreement, fearing it would undermine congressional efforts to ban the platform through legislation.
"The reported settlement is a slap on the wrist that will not meaningfully change TikTok's exploitation and harm of children," said Haley Hinkle, policy counsel for Fairplay for Kids. Her organization estimates TikTok's actual liability under the Children's Online Privacy Protection Act could exceed $250 billion based on the scale of violations.
The $400 million agreement conflicts with Attorney General Pam Bondi's February 2025 policy prohibiting third-party settlements. Bondi's memo states settlements "should be used, first and foremost, to compensate victims, redress harm, or punish and deter unlawful conduct." Instead, funds will flow to the Departments of Interior and Commerce for D.C. beautification projects, though specific allocations remain unconfirmed.
At the maximum COPPA penalty of $51,744 per violation, the $400 million fine covers fewer than 8,000 violations. A University of California, San Francisco study found 68.2 percent of 11- and 12-year-olds have TikTok accounts. Fairplay for Kids used that figure to estimate more than 5 million potential violations from that age group alone. The settlement includes no admission of wrongdoing and no meaningful injunctive relief to change TikTok's product design.
"It's another example of how the Biden administration couldn't get out of its own way," said one source familiar with the 2024 negotiations, speaking anonymously to discuss internal deliberations. The Justice Department filed its lawsuit against TikTok in August 2024 without mentioning the nearly completed $1 billion settlement, ensuring the case would extend beyond that year's presidential election.
Vice President JD Vance personally brokered the $14 billion restructuring deal that kept TikTok operating in the United States, playing a central role in negotiations that shielded the platform from a nationwide ban. The Trump administration now stands to collect up to $10 billion in fees from that arrangement while accepting a fraction of potential penalties for child privacy violations.
Fairplay for Kids called the $400 million settlement "nothing more than pennies on the dollar." The company's 2019 settlement over similar violations with Musical.ly, TikTok's predecessor, totaled just $5.7 million, establishing a pattern of minimal consequences for repeated offenses.
President Trump's fiscal year 2027 budget proposes a $10 billion "Presidential Capital Stewardship Program" for D.C. beautification, dwarfing the National Park Service's $2.2 billion operating budget request. The administration seeks to cut NPS construction and major maintenance by 55 percent while reducing resource stewardship funds by 53 percent.
Senator Jeff Merkley, an Oregon Democrat, told reporters he was "a 'hell no' on giving Trump a blank check for vanity projects." Interior Secretary Doug Burgum told lawmakers the beautification funds would address deferred maintenance. The NPS estimates D.C.-area backlogs at just over $2 billion, leaving roughly $6 billion unaccounted for in the $10 billion proposal.
The settlement must still be approved by TikTok's board, which was expected to vote on the agreement Friday. TikTok did not respond to requests for comment about the negotiations or the diversion of funds to political vanity projects.
Hinkle noted that the settlement "will not meaningfully change TikTok's exploitation and harm of children." She said "Fairplay first raised TikTok's rampant COPPA violations to the Commission more than five years ago." A better-resourced FTC might have held TikTok accountable much quicker and more forcefully, she said, calling for settlement funds to strengthen enforcement rather than fund political priorities.
The Justice Department's August 2024 lawsuit alleged TikTok knowingly permitted children under 13 to create accounts without parental consent, collected extensive data from those children, and failed to honor parents' deletion requests. Human reviewers spent an average of five to seven seconds determining whether accounts belonged to children, according to the complaint.
With trial in the case scheduled for May 2027, the settlement allows TikTok to avoid potentially catastrophic liability while continuing operations unchanged. Millions of young internet users, left unprotected by political games in Washington, will keep scrolling through the same algorithm-driven feed that brought them to TikTok in the first place.