Mountain View Voice

News - August 17, 2012

Google fined $22.5 M over privacy settings

by Gennady Sheyner

Google will be required to pay a $22.5 million penalty after the Federal Trade Commission (FTC) charged the Mountain View-based Internet search giant with misrepresenting its privacy settings to its users.

The privacy settlement, which according to the FTC is the largest penalty ever for violation of a commission order, came after a Stanford University graduate student uncovered the company's placement of "cookies" on users' computers even if they use Apple's Safari browser, which is set by default to block the cookies. Cookies are data that is stored in a browser that tracks users' online activities. They are often used by companies to send targeted ads to users.

In addition to the penalty, the FTC's order requires Google to "disable all tracking cookies it had said it would not place on consumers' computers," according to a commission statement.

Jonathan Mayer, the Stanford student who brought Google's cookie policy to light, wrote in a February post on his blog that Google and Vibrant Media (a company that specializes in display advertising) "intentionally circumvent Safari's privacy feature." He also provided on his blog a detailed technical analysis of Apple's Safari browser and the process Google followed for planting cookies despite the privacy features.

The FTC charged in its complaint that Google had been placing cookies on computers of Safari users for several months in 2011 and 2012, "although Google had previously told these users they would automatically be opted out of such tracking, as a result of the default setting of the Safari browser used in Macs, iPhones and iPads."

According to the FTC, Google's "misrepresentations" violated its October 2011 settlement with the FTC, which barred the company from "misrepresenting the extent to which consumers can exercise control over the collection of their information."

The commission issued a statement Thursday, Aug. 9, saying that its settlement "is intended to provide a strong message to Google and other companies under order that their actions will be under close scrutiny and that the Commission will respond to violations quickly and vigorously."

"No matter how big or small, all companies must abide by FTC orders against them and keep their privacy promises to consumers, or they will end up paying many times what it would have cost to comply in the first place," John Leibowitz, chairman of the FTC, said in a statement.

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