Documents, emails, and witnesses confirm that Google CEO Larry Page knew about and allowed ads from online pharmacies for years. However, as part of the $500 million forfeiture to the Department of Justice, these documents won’t be released.
"Larry Page knew what was going on," Rhode Island U.S. Attorney Peter Neronha told the Wall Street Journal. "We know it from the investigation. We simply know it from the documents we reviewed, witnesses that we interviewed, that Larry Page knew what was going on."
The Half-Billion Dollar Settlement
The Department of Justice began investigating Google for allowing illegal advertisements from Canadian pharmacies following a sting operation in 2009. Those pharmacies were advertising drugs to U.S. consumers.
Google and the DOJ struck a deal in which Google would hand over the $500 million that was gained since 2003, when the illegal ads were first pushed into the AdWords system. In exchange, Google received a non-disclosure agreement that would prevent major details of the case from being released.
This is one of the largest forfeiture penalties in U.S. history and opens the door for additional cases against Google.
While Google itself has evaded most penalties when it comes to deceptive advertisements, the Communications Decency Act that prevented prosecution has shown numerous holes. In addition to federal crimes (such as importing pharmaceuticals), foreknowledge from Google on deceptive practices may play a big role in the success of future cases.
Google as a Willing Accomplice
But how much foreknowledge was there in this case? In a prepared statement, Google acknowledged that they were aware that violations were being made.
"It’s obvious with hindsight that we shouldn’t have allowed these ads," read the statement. What was happening specifically was that pharmacies were getting assistance in setting up and advertising their sites in Canada, but were not being restricted from changing their geo-location targeting to reach U.S. citizens. While aware of this and other sneaky ways to get into U.S. search, Google did nothing to prevent the tactics from succeeding.
Ben Edelman, an anti-adware and spyware advocate who formerly worked as a consultant to Microsoft and has history of anti-Google sentiments, discussed the issues at length, accusing Google of additional deceptive practices and knowledge of other illegal advertisements.
He specifically cites ads that offer free services but that actually come with a fee, ads that offer something that should be free for a cost, and ads that help users find copyright violation resources (such as audio or movie rippers). The motive, according to Edelman, is nothing more or less complicated than profit.
This Year's Premier Digital Marketing Event is #CZLSF
ClickZ Live San Francisco (Aug 11-14) will bring together the industry's leading online marketing practitioners to deliver 4 days of educational sessions and training workshops. From Data-Driven Marketing to Social, Mobile, Display, Search and Email, the comprehensive agenda will help you maximize your marketing efforts and ROI. Register today!