The top US data privacy regulator has accused Meta, the firm that owns Facebook and Instagram, of not putting proper parental controls in place.
The Federal Trade Commission (FTC) also said Meta should be banned from making money from children's data.
"The company's recklessness has put young users at risk, and Facebook
needs to answer for its failures," it said.
Meta hit back, calling the regulator's move a "political stunt" and accusing it of overstepping its authority.
The FTC said an independent investigation had found "several gaps and weaknesses in Facebook
's privacy program" that posed "substantial risks to the public".
Users aged under 13 were found to be still allowed to engage in chats with contacts not vetted by parents.
The regulator also said Meta continued to give third-party apps access to private information after promising to cut off access if users failed to use the apps in the previous 90 days.
The FTC has proposed a series of actions, including:
* A blanket prohibition against monetising data of children and teens under 18
* A pause on the launch of new products until it could be established they were in full compliance with privacy rules
* Limits on future uses of facial recognition technology. Meta would be required to disclose and obtain users' affirmative consent for any future uses of facial recognition technology.
In response, Meta's spokesperson, Andy Stone, said the move was a "political stunt".
He said Meta was being singled out "while allowing Chinese companies, like TikTok, to operate without constraint on American soil".
He also accused Lina Khan, who chairs the FTC, of antagonising American business.
The FTC's case began in 2018, after it was revealed that the personal data of tens of millions of Facebook
users had been taken by Cambridge Analytica.
The regulator has looked to rein in some of the powers wielded by Big Tech. However, companies such as Meta believe they are being unfairly treated.
"Despite three years of continual engagement with the FTC around our agreement, they provided no opportunity to discuss this new, totally unprecedented theory," Mr Stone said.
The FTC, however, believes that Meta "has repeatedly violated its privacy promises" and wants tougher action to protect younger users.