Google will Pay Record $22.5 Million in FTC Fines in Connection with Tracking Cookie Placement

By Ed Silverstein August 09, 2012

Google will pay a record $22.5 million in fines after the Federal Trade Commission (FTC) claimed it “misrepresented” to Safari users it would not place tracking cookies or serve them targeted ads.

Google’s actions were a violation of an earlier privacy settlement between the company and the FTC, the commission said.

The settlement marks the largest penalty the FTC ever received for a company violating a commission order. As part of the settlement, Google also has to disable all the troublesome tracking cookies, the FTC adds. 

“The record setting penalty in this matter sends a clear message to all companies under an FTC privacy order,” Jon Leibowitz, FTC chairman, said in a recent statement.  

“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,” Leibowitz added.

By placing a tracking cookie on a computer, Google could have collected information about a user’s web-browsing and use the information to serve online ads targeted to the user’s interests or for other purposes, the FTC said.

The FTC added that in 2011 and 2012, Google placed an advertising tracking cookie on the computers of Safari users who visited sites within Google’s DoubleClick advertising network.

This happened despite Google telling the users they would be opted out of tracking, according to the FTC. Google also told users that the Safari browser is defaulted to block third-party cookies, as long as users do not change their browser settings, the FTC said. By this method, it is similar to opting out of this Google advertising tracking cookie, the FTC said. In addition, Google is a member of the Network Advertising Initiative, which requires members to disclose data collection and use practices, the FTC added.

Google circumvented the Safari browser’s default cookie-blocking setting and placed a temporary cookie from DoubleClick, the FTC alleged. The initial temporary cookie “opened the door to all cookies from the DoubleClick domain, including the Google advertising tracking cookie that Google had represented would be blocked from Safari browsers,” the FTC claimed.

In 2011, Google agreed to a settlement which kept it from – among other things – “misrepresenting the extent to which consumers can exercise control over the collection of their information.” The prior settlement was in response to allegations that Google used “deceptive tactics and violated its privacy promises when it launched its social network, Google Buzz,” the FTC said.

The new consent decree is subject to court approval.

Even though the fine represents a record, $22.5 million also represents how much Google earns about every 12 hours, according to the Business Insider.




Edited by Brooke Neuman

TechZone360 Contributor

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