Facebook Is Using Your Name and Photo in Ads
One of the things you might have noticed is that Facebook can use your name and photo in ads. The trick is, YOU never see it. Your friends do. So you really don't have any idea what kind of thing Facebook is associating with your likeness.
Since Facebook doesn't do a great job showing you how to stop this, I did some digging and found detailed instructions on how to prevent it.
Once you log into Facebook, look for the little padlock icon next to your name on the left-hand side. That's where all the privacy settings are. Click on that, and then click "See More Settings". Next find and click "Ads" on the page that comes up. Then you'll see an "Ads and Friends" section. Click the "edit" link next to that. Here you'll find an example of a Facebook ad, and a drop down menu next to "Pair my social actions with ads for...". Choose "No one" to keep your name from showing up in ads your friends see. Save those settings. - VIA Techguylabs.com
I've talked to a few people who are angry about this and I get it. But you do have to remember that Facebook is free and nobody is forcing us to use it. If you get sick of their privacy policies, you do have the choice to ditch it.