Man walks out of a gay bar. Has picture taken by anti-gay vigilanties. Facial recognition allows them to find him on Facebook and show the picture to his family, forcing him to be "outed" and ending in a Tyler Clementi situation.
Any facial recognition software could do this. Maybe the government already does this. I have pictures of myself on my Facebook page. The CIA could already have crawled over Facebook building a DB of everyone's name and photo.
Also, people being accused of things they didn't do (as another poster suggested) is hardly anything new. I sympathize with American posters not having faith in their justice system to sort out the facts though, as it seems that whoever can hire the most expensive lawyers wins over there.
It's sad that you have to resort to trying to avoid attention in the first place in case you are accused of something (and also sad that nobody really seems to see the problem with this). The guy ranting about privacy violation in East Germany should be looking at that angle of it.