Since Facebook is a Little Confused about Privacy

You need to opt out of them using your picture in ads. Carl Zimmer explains how:

Facebook lets 3rd party advertisers use your posted photos without your permission. To opt out: Click on SETTINGS (located on top of page in blue bar, next to logout); Select PRIVACY SETTINGS; Select NEWS FEEDS and WALL; Select the TAB that reads Facebook Ads. There will be a drop down box; Select NO ONE. Save your changes & then pass this on. [Thanks to Virginia Postrel]

NB: I use AdBlock Plus and I needed to temporarily disable it in order to see the drop-down menu.

Via Greg Laden