Wednesday, 11 July 2012

Google nailed with $22.5 million fine in Safari hacking case


For the last few years, Google has been secretly overriding the browser privacy setting of searches performed on Safari web browsers to collect user data. They were nailed on this practice earlier this year, and have now agreed to pay a $22.5 million dollar fine -- the largest fine ever handed out by the Federal Trade Commission.
Here's how the scheme worked -- let's say you did a Google search on your Apple computer, iPhone, or iPad. Your Safari browser, by default, is programmed to not track your searches and online behaviors. Google had code inserted into these searches to override your Safari privacy settings, in order to keep delivering you those ubiquitous targeted advertisements.
The practice was discovered a Stanford student who uncovered the practice in a research paper. In February, the Wall Street Journal did a full expose on Google's bypassing Safari privacy settings, and Google quickly disabled the code. Earlier today, sources tell the Journal that Google has agreed to the $22.5 million fine, roughly $16,000 for each day the code was in place.
Google was not the only company found to be engaging in this practice. They were, however, the biggest company engaging in this practice, and they made the most money from the cookie-setting chicanery.
While it will be the largest fine ever levied by the FTC, it's still just pocket change for a company like Google. At the GooglePlex in Mountain View, CA, people use million dollar bills just to clean coffee spills off their desk.
Don't believe me? It's only a slight exaggeration. That Wall Street Journal article notes that it will take Google only five hours to make up that $22.5 million. This fine is not really going to disrupt their business model or interfere with their endless buffets of free employee lunches.
After all, just last year Google coughed up a hefty $500 million dollar fine to the Justice Department for hosting ads for illegal sales of prescription drugs.
The real penalty payments start when the class action lawsuits begin to roll in, and you had better believe they will. Attorneys General in several individual U.S. states are in discussions for a multi-state lawsuit against Google for this very practice. In these state suits, Google can be fined up to $5,000 for each individual violation.

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