Google to Pay $22.5 Million as Fine for Privacy Practices

The outcome of the lawsuit against Google in its wrangle over privacy and integrity of its internal controls hit the headlines this week, seeing them paying a $22.5M fine to settle the latest regulatory case.

The Federal Trade Commission announced the penalty on Thursday, matching the figure already widely reported last month by The Associated Press and other media outputs. Perhaps most significantly, it is the most the FTC has ever levied for a civil violation.

This follows FTC’s allegations that Google duped millions of users who use Apple’s Safari Browser. They had previously assured users that as long as they did not alter browser settings, which would allow tracking; it would not monitor their online activities.

According to FTC, by creating a technological loophole which enabled an advertising network to shadow unwitting Safari users, Google breached that promise, allowing the advertising network DoubleClick, to get access to information which showed how to maximize marketing pitches to Safari users.

In conclusion, FTC stated that this contradiction between Google’s tracking and its previous privacy assurances given to Safari users violated a vow the company made in a previous settlement with the agency in October.

Piling on the bad news for Google, this latest settlement is separate to the ongoing FTC inquiry alleging Google has abused its dominant position as an internet search engine to highlight its own services as not only a detriment to rivals but to further drive up its online advertising revenue.

Though insisting it wasn’t deliberate or by design, Google has acknowledged that DoubleClick did track Safari users. They have stated that this occurred as a result of them tinkering, which they were unaware, would result in the privacy settings being opened up for broader surveillance. The company has stated they remedied the situation in February this year and that at no time personal information was gathered. Google said on Thursday “We set the highest standards of privacy and security for our users.”

The latest incident is just the latest in a number of privacy issues at Google. An FTC investigation followed their set up of Buzz in 2012, resulting in them agreeing to 20 years of oversight and a pledge not to mislead consumers about privacy. There was also a number of issues surrounding the company’s online mapping service, which though not resulting in action by FTC, they did fine the company for impeding their investigation. As with the latest concerns, Google put those down to inadvertent slips.

According to David Vladeck, the director of FTC’s bureau of consumer protection, this defense is wearing thin. “In some ways, as a regulator, it’s hard to know which answer is worst:  ‘I don’t know’ or ‘I did it deliberately’.

Whatever, certainly the FTC will hope the fine will force Google to pay better attention to safeguarding the privacy of its users.

Perhaps this is a pipedream, with news that the FTC’s fine didn’t do anything to put off investors. At close on Thursday, Google had added 12c to close at $642.35, whilst modest, the value of the company increased by $39m, significantly more than the value of the fine.


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