Uber hit with criminal probe into ‘Greyball’ ghost app
Program was used to evade regulators
SAN FRANCISCO Federal authorities have launched a criminal inquiry into Uber’s use of its so-called ghost-app program, an official familiar with the matter said.
The official, who is not authorized to comment publicly, did not elaborate on the scope of the Department of Justice investigation into the company’s program known as Greyball.
The controversial technology allowed Uber engineers to take over a user’s app and send them a map that did not accurately reflect which drivers were in the area.
Uber has said Greyball was developed to monitor users who had violated its terms of service and to potentially protect drivers by steering dangerous riders away from them, according to a March 8 company blog post in the wake of a March 3 New York Times report that exposed the program.
But the company also admitlems ted Greyball was used in part to track and avoid regulators who might be hailing rides to scrutinize the company’s business practices. The post added that Uber would be “expressly prohibiting its use to target action by local regulators going forward.”
Uber declined to comment on news of a DOJ investigation but provided a letter the company sent to Portland, Ore., officials in March that describes the program and claims Greyball was used there “exceedingly sparingly.”
Reuters was first to report the existence of the criminal probe Thursday, which hours later was echoed by The Washington Post.
The investigation represents a significant ratcheting up of prob- for the world’s most valuable start-up, which already is dealing with an internal probe about a sexist work environment and a lawsuit from Waymo over allegedly stolen self-driving car technology.
Uber officials received a subpoena from a Northern California grand jury seeking documents that explained how and where Greyball was deployed, one person familiar with the request told Reuters, which would indicate a criminal investigation is underway. That said, a grand jury subpoena does not necessarily indicate wrongdoing or signal that charges are imminent.
Another source told Reuters that the law firm Shearman & Sterling had been retained to conduct an internal investigation into Greyball and its use. A Shearman spokeswoman did not immediately respond to USA TODAY’s request for comment.
Uber’s use of Greyball was recorded on video in 2014, when a code enforcement inspector in Portland, Ore., tried to hail an Uber as part of a sting operation, according to the Times. Uber had started operating in Portland without permission from the city and “greyballed” a city official who was hailing a ride.