The FTC announced today that Google has settled with the commission over the “Buzz” privacy debacle — agreeing to 20 years of privacy audits. The commission said in a statement that this is the first time an FTC settlement order has required a company to implement a comprehensive program to protect the privacy of consumers’ information.

“When companies make privacy pledges, they need to honor them,” said Jon Leibowitz, Chairman of the FTC, in a statement. “This is a tough settlement that ensures that Google will honor its commitments to consumers and build strong privacy protections into all of its operations.”

When Buzz launched users were offered two options: “Sweet! Check out Buzz,” and “Nah, go to my inbox.” The FTC charges that Google did not adequately inform users who opted-in to Buzz that the identity of individuals they emailed most frequently would be made public by default.

From the FTC:

In response to the Buzz launch, Google received thousands of complaints from consumers who were concerned about public disclosure of their email contacts which included, in some cases, ex-spouses, patients, students, employers, or competitors. According to the FTC complaint, Google made certain changes to the Buzz product in response to those complaints.

When Google launched Buzz, its privacy policy stated that “When you sign up for a particular service that requires registration, we ask you to provide personal information. If we use this information in a manner different than the purpose for which it was collected, then we will ask for your consent prior to such use.” The FTC complaint charges that Google violated its privacy policies by using information provided for Gmail for another purpose – social networking – without obtaining consumers’ permission in advance.

The agency also alleges that by offering options like “Nah, go to my inbox,” and “Turn Off Buzz,” Google misrepresented that consumers who clicked on these options would not be enrolled in Buzz. In fact, they were enrolled in certain features of Buzz.

The complaint further alleges that a screen that asked consumers enrolling in Buzz, “How do you want to appear to others?” indicated that consumers could exercise control over what personal information would be made public. The FTC charged that Google failed to disclose adequately that consumers’ frequent email contacts would become public by default.

“We don’t always get everything right.” Google said on their official blog. “The launch of Google Buzz fell short of our usual standards for transparency and user control.” This comes, of course, immediately following Google’s announcement that it was adding its own version of a “like” button that, when pressed, would publicly associate user’s names with search results, webpages, and even ads.

The Buzz settlement has a public comment period of 30 days. If you’d like more information about the settlement, click here.

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