German privacy regulators have fined Google a "totally inadequate" €145,000 (£124,000) for illegally collecting data over unsecured Wi-Fi networks during its Street View project.
The violations - which took place in Hamburg - saw Google's custom-built mapping vehicles storing personal information including emails, passwords, and photos without authorisation.
Google has claimed that the information was collected in error and represented a "significant lapse of Google's internal control mechanisms," but continues to deny allegations of deliberate snooping.
"We work hard to get privacy right at Google. But in this case we didn't, which is why we quickly tightened up our systems to address the issue," a company spokesperson said.
"The project leaders never wanted this data, and didn't use it or even look at it. We cooperated fully with the Hamburg DPA throughout its investigation," the Internet juggernaut added.
However, the authorities in Hamburg took a considerably less charitable view, calling the incident "one of the most serious cases of violation of data protection regulations that have come to light."
The watchdog said it accepted Google may have collected the data in error, but added that the penalties would have been far more severe were it not for constraints on its regulatory powers.
"Google did cooperate in the clarification thereof and publicly admitted having behaved incorrectly," said Hamburg Commissioner for Data Protection and Freedom of Information, Johannes Caspar.
"As long as violations of data protection laws are punishable by discount rates, the enforcement of data protection laws in a digital world with its high potential for abuse will be all but impossible," he continued.
"The regulation currently being discussed in the context of the future European General Data Protection Regulation, whereby a maximum fine of [two] percent of a company's annual turnover is provided for, would, on the other hand, enable violations of data protection laws to be punished in a manner that would be felt economically," Mr Caspar added.
The Street View 'snooping' occurred between 2008 and 2010. Google has subsequently deleted all illegally collected data.