In line with last month's report on negotiations between Google and the U.S. Federal Trade Commission (FTC) over the company's circumvention of privacy settings in Safari, the FTC has officially announced that Google has agreed to pay a record $22.5 million penalty to settle the case.
The settlement is part of the FTC’s ongoing efforts make sure companies live up to the privacy promises they make to consumers, and is the largest penalty the agency has ever obtained for a violation of a Commission order. In addition to the civil penalty, the order also requires Google to disable all the tracking cookies it had said it would not place on consumers’ computers.
“The record setting penalty in this matter sends a clear message to all companies under an FTC privacy order,” said Jon Leibowitz, Chairman of the FTC. “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.”
|Graphic from The Wall Street Journal|
Google took advantage of a loophole in Safari's privacy settings designed to prevent placement of third-party cookies by default, using invisible web forms to trick Safari into thinking that users had interacted with Google's ads and thus allowing cookies to be placed on the device.
The FTC specifically charged Google with violating an October 2011 order related to a previous case of privacy violations. In the new Safari case, FTC commissioners voted 4-1 to approve the settlement, with the dissenting commissioner arguing against the settlement allowing Google to deny all liability related to the issue.