Google fined nearly $400m for breaching location tracking rules in the US

The case leading to the multistate payout was instigated by Michigan Attorney General Dana Nessel, along with 39 other attorneys general. It is the largest multistate privacy settlement in the history of the US, with Michigan alone receiving close to $12m from the settlement.

"Google makes the majority of its revenue from using the personal data of those who search in its browsers and use its apps," Nessel said.

"The company's online reach enables it to target consumers without the consumer's knowledge or permission. However, the transparency requirements of this settlement will ensure that Google not only makes users aware of how their location data is being used, but also how to change their account settings if they wish to disable location-related account settings, delete the data collected and set data-retention limits."

Location data is a key part of Google's digital advertising business which it uses in combination with the personal and behavioural data it collects to build detailed user profiles for ad targeting.

Location data is among the most sensitive and valuable personal information Google collects as even a limited amount can expose a person's identity and routines and can be used to infer personal details.

Google said in a blog post on Monday that it would be "making updates in the coming months to provide even greater controls and transparency over location data."

Jose Castaneda, a spokesperson for the search giant, said: "Consistent with improvements we've made in recent years, we have settled this investigation, which was based on outdated product policies that we changed years ago."

An investigation was opened following a 2018 Associated Press article that revealed Google "records your movements even when you explicitly tell it not to."

The article focused on two Google account settings: 'Location History' and 'Web & App Activity'. Location History is off unless a user turns on the setting, but Web & App Activity, a separate account setting, is automatically on when users set up a Google account, including all Android phone users.

As detailed in the settlement, the attorney generals found that Google violated state consumer protection laws by misleading consumers about its location-tracking practices since at least 2014.

Specifically, Google caused users to be confused about the scope of the Location History setting, the fact that the Web & App Activity setting existed and also collected location information, and the extent to which consumers who use Google products and services could limit Google's location tracking by adjusting their account and device settings.

The settlement requires Google to be more transparent with consumers about its practices.