The report was made by Dr. Alexander Tuzhilin, a professor of Information Systems at NYU. It was part of an agreement of the Lane's Gifts vs. Google settlement.

Based on Mr. Tuzhilin's assessment, google's practices against click fraud are reasonable. It was a 47 page report and you can learn a lot by reading it here.

One notable part was this.

"Google has built the following four 'lines of defense' for detecting invalid clicks: pre-filtering, online filtering, automated offline detection and manual offline detection, in that order. Google deploys different detection methods in each of these stages: the rule-based and anomaly-based approaches in the pre-filtering and the filtering stages, the combination of all the three approaches in the automated offline detection stage, and the anomaly-based approach in the offline manual inspection stage. This deployment of different methods in different stages gives Google an opportunity to detect invalid clicks using alternative techniques and thus increases their chances of detecting more invalid clicks in one of these stages, preferably proactively in the early stages." (p. 47)

Google should have communicated these methodologies and techniques earlier to webmasters and advertisers to give them a clear picture of their "line of defense" against click fraud.

They don't necessarily have to give away their exact algorithm but advertisers would feel more comfortable knowing what google is doing about click fraud and how much systems are in place to safeguard their interests.