Just when I was comfortable with my privacy settings on Facebook. I read a weird status update saying their pictures are available for anybody to see, who is friends with one of the person who liked or commented on their picture. I kept ignoring the update for a day, till it started mushrooming on other people's profiles and I received notifications of people from my 'limited' lists liking my restricted pictures.
This lead me to check my privacy settings which seemed to be the same as before. But as I checked my photos, I discovered that since after August 12, Facebook allows me to change the privacy of each photo individually on my 'profile pictures', 'mobile uploads' and 'wall photos'. This is a step by step breakdown of how to fix this problem. Pictures uploaded till August 12 have the same old privacy settings. [Earlier we were able to manage the visibility as an an album]