[UPDATED INFORMATION BELOW]

On Tuesday, Facebook took the hardest bashing of its short history, with FORTUNE’s Josh Quittner echoing the rest of the blogosphere in a post ruefully titled “RIP Facebook?” This follows Monday’s news that Facebook confirmed a finding by security firm Computer Associates that Beacon still sends information back to Facebook even when you are not logged in. (For a complete history of the last few weeks, check this New York Times article by Louise Story.) Subtract a few key advertisers, add a lawsuit questioning the allegedly shady history of Facebook’s founding and an attempt by Facebook to block First Ammendment rights, and Facebook seems to be embroiled in a PR quagmire.

The question on everyone’s mind is: Where is Mark Zuckerberg?

He’s playing Jetman, of course. Take a look at the below screen cap I grabbed from his Facebook profile (click to enlarge):

WOW! A score of 1942! Congrats, Mark!

Was he working off a little stress while in between Crisis Control sessions with his PR team? The blogosphere doesn’t think so. Just look at this post by Robert Scoble advising Zuckerberg to say something (this is just the nice stuff):

Facebook’s PR machinery is hiding its head in the sand and hoping this story goes away.

Hint: it’s not.

Do the press conference. Admit you screwed up. Take your shots. Look into the camera and say you’re sorry.

Crisis PR hint: don’t answer company bashing with text messages. Do it in video and with live events. Have the CEO do it.

Henry Blodgett, Todd Defren (satirically blogging as Fake Mark Zuckerberg), Brian Solis, and several other key PR bloggers all offered similar advice: Fess Up.

So what exactly can Facebook do to pull themselves out of the muck:

1. Zuckerberg–not a PR spokesperson–needs to admit to the community and advertisers he made a mistake.

• Explain that FB learned the hard way that privacy is important.
• As a result, FB wil allow a members to Opt-In (as opposed to currently being forced to Opt-Out) to Beacon.
• FB apologizes profusely and promises to make the selling and use of member data a transparent process.

2. Utilize the social media upon which FB is built.

• Eat the loss of prime Ad real estate and post the video apology in a banner over the newsfeed, not in the New Features” group.
• No blog posts since mid-November. Fix that.
• If you are feeling a little more hip: Create a live videocast (to be archived) with live questions being submitted through the community and Twitter.

3. Send an open letter to blogs and top-tier publications. Reach out to the reporters and bloggers who feel used and lied to.

• Better yet, do a video blog tour with top bloggers (ala Don Imus, et al.)

4. Appoint a User Privacy Guru to launch an educational program on how member data is handled and what members can do to protect their privacy.

• Create a Privacy Rights/User Data partnership with other social networks.
• This transparency and education will regain user trust.

5. Community Managers address bloggers concerns as they come up.

• Don’t hide behind your PR spokesperson. Get involved!

Don’t forget your community (and your financial success) is based on the users. You have to listen to them and respect them. If they aren’t happy, they’ll easily move on to the next big thing. Part of me hopes that FB really thought users would see the value in Beacon. The other part thinks that FB only saw the dollar value it could gain from Beacon.

Social networks are trusted spaces. Facebook differentiated itself as the social network where members could control privacy settings, thereby allowing only some friends to see certain things. We felt like Facebook was a safe place where we could share our lives with our friends. Beacon violated that trust. It’s sad and I feel completely used.

A quick Twitter poll asking what Facebook could do to regain trust yielded several responses, all easily summed up by Kyle Flaherty‘s Tweet:

What can Facebook do to regain your trust? Or do you feel Facebook has done nothing wrong?

[UPDATE: This morning, Mark Zuckerberg posted an apology on Facebook's Blog. Is that enough? Do you trust them again?]

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The new code bars top executives and directors from posting messages about Whole Foods, its competitors or vendors on Internet forums that aren’t sponsored by the natural-foods chain.

Apparently, this is a response to all the messes (read un-ethical practices) that got Whole Foods in to trouble this summer. (Check out Paull Young’s Twitter “Fake John Mackey” profile)

The move comes amid an informal Securities and Exchange Commission inquiry into anonymous postings by Chief Executive John Mackey on Yahoo Finance stock-market forums from 1999 through 2006. Mr. Mackey touted Whole Foods shares, blasted rivals and sparred with other users in more than 1,000 messages.

To me, Whole Foods could have taken different steps to ensure the board, share-holders and consumers that they were changing their image and increasing transparency. They already have a few corporate blogs, a podcast, and video–it doesn’t seem like social media is new to them.

First off, have Mr Mackey write a personal apology on the corporate blog in a post that outlines Whole Foods commitment to ethics. He already has a blog. The last post is from July 18 saying that, due to investigation, the blog is on hold. That’s what people see when they explore the Whole Foods’ blog–not pretty. The post before that is an apology statement from July 17th in quotes with PR contact info and in traditional apology statement form. Once again, not a good thing for consumers to see. Wouldn’t it be great to hear something real? That’s what the blog is there for!

A blog shouldn’t be a feeder for corporate messaging, but HEY, if you can incorporate some messages appropriately, then do it. Some core values from Whole Foods’ site: Extraordinary Customer Service; Education; Self-Responsibility; and Open and Timely Information. All of these can be crafted in to a pro-active post on WF’s new, transparent ethics practices. This can also lead to an announcement of a community launch.

Yes, community launch. The social media features currently on the site are informative and pretty cool, but ultimately they seem one sided. As a consumer, I’m not engaged in an open exchange of ideas, I’m getting marketed to. WF should take a page from Dell and really get the consumer discussing things Whole Foods thinks is important.

(There are great videos of Mr Mackey speaking about World Farming, but what about forums? Anyway, I digress, I have tons of other ideas to help Whole Foods spruce up their site, but they are not “Crisis Management” related.)

For me, transparency is important with food. I want to know how my food gets to my table. I think Whole Foods would agree in the importance of that. Banning your top execs from online sites is a bold step–but a step towards silence and stifling. Take a big leap and open up your corporate side. It will increase trust in the whole business.

What do you guys think? Could WF have handled things differently? Am I completely off target?

(Hat tip to Mike Keliher for his Tweet linking to the original article.)

[I am emailing Whole Foods' spokesperson for comment. Stay tuned!]

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