Faces of Business 2007: Peter Fleischer, Google privacy counsel

December 30th, 2007

Before posting anything online, Peter Fleischer asks himself: Is this something I want to make public forever?

As Google’s global privacy counsel, he thinks a lot about the implications of sharing information with the world. As a result, in his private life, he takes a cautious approach.

Sure, Fleischer shops on Amazon.com, a company he trusts will keep his credit card number safe. But he’s uncomfortable sharing photos online and generally uses a pseudonym on social-networking sites like Facebook.

“You can be really interested and conscious of privacy issues without being a paranoid, go-hide-in-the-woods kind of guy,” Fleischer said.

Internet privacy was a major issue in 2007, and Google, perhaps more than any company, came to symbolize its compromises. Much of what people do online - their search engine queries and the ads they click on - is logged by Internet companies, generating intense criticism from groups that liken such data collection to the incarnation of George Orwell’s Big Brother.

Given Google’s popularity and breadth of offerings, it is inevitably public enemy No. 1 to consumer privacy advocates. At conferences and government hearings across the globe, the company’s record on privacy is a frequent target of scrutiny, whether related to its proposed $3.1 billion acquisition of online advertising company DoubleClick or the length of time it retains records of search queries.

The outcome of the Internet privacy wars, in general, could have a significant financial impact on Google and its rivals. The more information a company is able to collect about its users, the better it can design ads to fit user interests.

Fleischer plays a key role at Google in evangelizing what he calls good privacy practices. His job is to get colleagues thinking about it as soon as they start brainstorming new products and to help decide what to tell users about any information the company compiles about their online habits.

“One of the things we insist on is that product teams think about privacy very early on,” Fleischer said. “It’s not something they can tack on at the end.”

Even within Google, there are differences of opinion on what to do, Fleischer said.

To some, transparency means a long, elaborate privacy policy. To others, it’s a short, three-sentence notice that many believe people are more likely to read.

And that’s only a start. There’s user consent to consider.

Should Google’s users have to click on something to give the company permission to collect data about their online habits, a process called opt-in? Or should they automatically have their tracks recorded, at least until they indicate otherwise, a process called opt-out?

Whatever the case, before Google releases a product, it must pass muster with what’s known as the product council. A group of company attorneys makes sure that privacy policies comply with the law and consumer expectations, among other things.

Fleischer joined Google in February 2006 after a stint overseeing privacy in Europe for Microsoft Corp. and as director of regulatory affairs. He works in Paris, and can speak fluent French and German.

Ask Fleischer a question and he’s liable to embark on a lengthy discourse, touching on the web of laws governing the matter globally or lack thereof. Most of all, he’s an avid defender of all things Google, which he said is taking the initiative to tackle many of the toughest privacy issues in the online era.

“I say we’re doing quite well,” Fleischer said. “That’s not to say that we’ve done everything perfectly, and it’s not to say that there’s (not) a lot of progress to be made.”

Fleischer is joined as a privacy specialist at Google by Jane Horvath, another attorney, who hails from the Department of Justice. In fact, a large number of people at Google touch on privacy as part of their jobs, but not full time like Fleischer and his colleague.

Despite a calm, bookish demeanor, Fleischer can be combative when it comes to criticism of Google. Marc Rotenberg, executive director of the Electronic Privacy Information Center, a consumer group that is a frequent thorn in Google’s side, recalled that Fleischer shouted at him during a conference in Montreal.

Rotenberg gave a speech, and Fleischer approached to take issue with his comments about Google.

“I remember him getting upset, shouting and walking away,” Rotenberg said. “It didn’t seem very Googly to me,” referring to an informal Google code of conduct that many take to include a cult of niceness.

Rotenberg described Fleischer as bright, and complimented him for saying that Internet companies should be more responsive and respectful of organizations and institutions involved in consumer privacy protection. But, he said, “Sometimes the right way to make privacy in the policy world is to listen, not talk - and he likes talking.”

In 2007, Fleischer found himself having to explain an array of Google policies in relation to privacy. Little that the company did seemed to escape complaints.

Google reduced the amount of time it retains records that can be traced to an individual computer to 18 months, instead of indefinitely. Although it was the first company to take such a step, it received ample criticism over why it keeps the information to begin with.

Google’s explanation is that it needs the logs to fight hacker attacks and to bill advertisers. Privacy groups fear that the information could leak out or be subpoenaed in legal proceedings, making public the private curiosities of users.

In addition, Google took heat for Street View, which offers photos of streets in a number of U.S. cities. By chance, people unwittingly were captured in the photos, in some cases in embarrassing situations such as exiting an adult bookstore or sunbathing.

This month, Google scored a victory when the Federal Trade Commission approved its proposed merger with DoubleClick over the objections of privacy groups, including Rotenberg’s. They had argued that the marriage would open the door to Google collecting even more data about user behavior, to create even more detailed dossiers on them.

The privacy groups are holding out hope that European regulators, who also are conducting a review, will be more receptive to their concerns.

One of Fleischer’s missions is to encourage more uniform global privacy laws, rather than the hodgepodge that he said makes it difficult for an international company such as Google to operate. His choice of principles to support has opponents accusing him of trying to water down rules in Europe with weaker ones from Asia.

In general, Fleischer said that despite the current focus on privacy, laws need updating.

“I think there’s been a lot of well-intentioned attempts to keep up with privacy in the evolving world of the Internet, but I think that hasn’t kept up with the stream of innovation in the industry,” he said.

In any case, Fleischer said, the idea of personal privacy isn’t what it used to be before the Internet, when people could count on information being forgotten, lost or buried in an archive.

“The ability to retain and find information, once it’s public, means that the whole concept of privacy is changing and might be irreversible,” he said. Online resources

Faces of Business is a year-end series of profiles featuring prominent people in the Bay Area business scene. To read all the profiles:

«www.sfgate.com».

Faces of Business is a year-end series of profiles featuring prominent people in the Bay Area business scene.

To read all the profiles, go to «www.sfgate.com». Peter Fleischer

Age: 44

Title: Global privacy counsel for Google

Most recent accomplishment: Eating blowfish sushi in Tokyo

Last place traveled: Kyoto

Last book read: “A Midsummer Night’s Dream”

Last Movie watched: “The Caine Mutiny”

Words to live by: “Il faut cultiver son jardin” (One must cultivate one’s own garden) - Voltaire

E-mail Verne Kopytoff at vkopytoff@sfchronicle.com.

Turkey’s president defends human rights record

December 30th, 2007

ABDULLAH Gul, the president of Turkey, yesterday defended its human rights record, but said much remained to be done, including tackling a law used to curb free speech.

The European Union, which Ankara hopes to join, has urged Turkey to scrap Article 301 of its penal code, which makes it a crime to insult Turkish national identity or state institutions. “Nobody is in prison in Turkey today for expressing their ideas, but there are many more things still to do,” Mr Gul told the parliamentary assembly of the Council of Europe in Strasbourg.

Mr Gul later said he wanted to see article 301 amended, noting it had caused much damage to Turkey’s image as it negotiates for EU membership.

Nationalist prosecutors in Turkey have used Article 301 against writers, journalists and academics, including the Nobel Literature laureate, Orhan Pamuk, although cases hardly ever end in convictions.

But the centre-right government of the prime minister, Tayyip Erdogan, has resisted EU pressure to scrap or amend Article 301, saying it would do so at its own pace.

Hrant Dink, a Turkish Armenian writer, was convicted under the article. He spoke out on the Ottoman Turkish massacres of Armenians in 1915 and was shot dead by an ultra-nationalist in January.

Carol Lloyd: Shedding light on gray areas of realty transactions

December 30th, 2007

“But can they really do that?”

It’s a question I’ve been asked again and again from first-time home buyers, seasoned sellers, just about anyone who finds herself in the middle of a real estate transaction that seems to have slipped into a gray zone between common practice and legal technicalities - between friendly business-as-usual and hardball negotiating.

When push comes to shove and shove turns to brawl, many folks suspect that the transaction has fallen into shadowy territory, causing them to question every aspect of the deal, and to mistrust everyone.

Are so many real estate deals really running afoul of laws and ethics?

I’m not so sure. Not being a real estate agent or real estate lawyer, I often don’t know how to answer the question when someone asks “Can they really do that?” And because each real estate transaction is a hornet’s nest of complexity, and feelings often get mixed up with facts, it’s difficult to distinguish what the home buyer or seller really heard as opposed to what they simply inferred.

So recently, when a friend uttered that familiar question in the midst of her own transaction from hell, I decided to go to the experts and attempt to shed light on some of the gray zones of real estate.

Hey, that’s my house! They accepted my offer and now I’m in the inspection period, and yet the listing agent is still holding open houses. Can they really do that?

“I think a lot of buyers don’t understand the difference between ‘active contingent’ and ‘pending without contingencies,’ ” says San Francisco agent Bonnie Spindler. Not only is marketing the home perfectly legal during the “active contingent” period (before all the contingencies have been lifted), she adds, it’s the duty of the listing agent to continue to show the home. “You really owe it to the seller - especially now.”

Spindler says that with banks increasingly not honoring commitments to make second loans, and many homes no longer appraising for the agreed-upon purchase price, more properties are falling out of escrow late in the game.

Moreover, with a market increasingly favoring buyers, more deals are collapsing after inspections, when buyers attempt to get deep discounts. In this new climate, agents are more likely to continue to look for backup offers, even though a transaction is moving along as planned.

Am I a patsy or what? My agent says that I can get credits back at closing, which means getting some cash from the buyer. Is that kosher, or is that mortgage fraud?

“A lot of people don’t understand that banks usually allow up to 3 percent of nonrecurring closing costs,” Spindler says. “And if there’s another $10,000 toward clearing a pest report, that’s usually OK as long as the bank knows. This practice has always been a tool for getting pest work done.” If the cash-back deal is concealed from the bank, however, it’s a serious crime. In effect, if you’re borrowing money under false premises and lying to the bank, that’s mortgage fraud. Otherwise it’s between you and your lender.

Falling through cracks in the contract. All the inspectors have told me we need a special inspection, but that will take additional time.

We requested that the sellers extend our inspection period, but they declined. At the same time, they’ve given us access to the property to do this extra inspection. Are we in contract or not?

Just because you’re out of the inspection period without a sellers’ signature on an extension doesn’t mean you’re automatically out of contract. But you have allowed the sellers a way to get out of the deal.

If buyers don’t sign off on the contingencies on time and the sellers want to force them to do so, they send the buyers documents informing them that they have “24 hours to perform” or fall out of contract.

If the buyers sign off on all contingencies within the 24-hour period, then the sale will go through as planned. But if they fail to release the seller from contingencies within that 24 hours, then the deal officially falls out of contract.

Under such circumstances, says Debbie Dell of Zephyr Realty, the buyers usually get their deposit back, but they shouldn’t expect to continue to do inspections or engage the sellers in further negotiations.

No news ain’t good news. The listing agent informed our agent we can do any inspections we want, but she doesn’t want to hear about them. In turn, our agent told us that it’s our job to pass on any reports to the listing agent. Is that normal?

“If you’re a professional, you don’t do this,” says Lorrie French of Pacific Union GMAC. Even if a home falls out of escrow, inspections become part of the public record and the seller must disclose them to any future buyers. Such disclosure laws may explain why some agents decide to act like real estate ostriches, but it’s not considered an acceptable practice.

“I’ve heard this done before,” says Dell, referring to the hear-no-reality selling agent. “But this is not a reputable agent. What’s more, it’s some cause for alarm. My position as a listing agent: The more you disclose, the better.”

Inspector paranoidus. We hired an inspector who will give us only a verbal appraisal of the property unless we receive written permission from the seller that he can write up his opinions. What’s this about?

Technically, the sales contract already gives written permission to inspect the property. “The only kind of sales exempt from inspections are probate sales,” French says. “But a regular sales contract stipulates that you have a right to any kind of inspection you want. So the buyer already has the explicit permission from the seller.”

But according to real estate agents I spoke to, inspectors sometimes try this tack when they are afraid their inspection could substantially lower the property’s value and therefore lead the seller to sue the inspector.

After all, as long as there is nothing in writing, the inspector is less liable for his opinions. It’s unlikely that sellers will give additional written permission, so the buyer may be tempted to simply hire the inspector for an oral evaluation of the property.

An oral evaluation may help the buyer decide whether to buy the property, but, unfortunately, it won’t help in negotiating a new price. Telling the seller “My inspector said the house is slipping down the hillside, so you should reduce the price by $100,000″ won’t carry much weight.

It’s only when you have a written report - which legally must be added to the disclosure packet for future sellers - that most sellers begin to pay attention. So, when offered an oral report, assess its real value before you agree. It may not be worth a hill of beans if you end up asking for a lower purchase price.

Where does that leave the beleaguered buyer? Like law, real estate is an adversarial system. Most of the things that look shady from the outside are often acceptable real estate practices. And what looks fair to one side may seem absurdly unjust to the other.

Although most aspects of real estate transactions are defined by highly specific laws, gray zones continue to hover around some of them. The more complex, the more potential for gray zones.

“The business has become extremely litigious,” French says. “And the laws are always changing, and there are ever more disclosures. So everyone is always trying to cover themselves.”

E-mail Carol Lloyd at surreal@sfgate.com.