Google has agreed to pay the largest fine ever imposed on a single company by the US Federal Trade Commission.
The firm agreed to pay $22.5m (£14.4m) after monitoring web surfers using Apple’s Safari browser who had a “do not track” privacy setting selected.
Google does not have to admit wrongdoing as part of the settlement.
The penalty is for misrepresenting what it was doing and not for the methods it used to bypass Safari’s tracker cookie settings.
Cookies are small text files that are installed onto a computer to allow it to be identified so that a user’s web activity can be monitored.
“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,” FTC Chairman Jon Leibowitz said in a statement.
The government agency launched its inquiry after a Stanford University researcher noticed the issue while studying targeted advertising.
He revealed that the search giant was exploiting a loophole that let its cookies be installed via adverts on popular websites, even if users’ browsers’ preferences had been set to reject them.
This allowed the firm to track people’s web-use habits even if they had not given it permission to do so.
Google said no “personal information” – such as names or credit card data – had been collected, and that the action had been inadvertent.
“The size of the fine in this case should deter any company from seeking to exploit underhand means of tracking consumers. It is essential that anyone who seeks to over-ride consumer choices about sharing their data is held to account.”