PC Probe: Public purse used to keep Google honest
Watchdogs are paying Google huge sums to keep scams from the top of search listings, Stewart Mitchell finds
Watchdogs are paying Google huge sums to keep scams from the top of search listings, Stewart Mitchell discovers.
Public bodies are having to spend hundreds of thousands of pounds every year to prevent scams from dominating Google’s search results, a PC Pro investigation has found.
Companies have previously complained that they feel obliged to buy advertising to avoid their brand being pushed below rivals that use their company’s name in search terms. Now official public bodies are falling into the same trap.
The Financial Conduct Authority (FCA), the UK’s regulator charged with protecting consumers from financial fraud, says it feels compelled to pay Google to run adverts to counter ads from scammers that appear above “organic” search results.
“It’s a massive problem the way the scammers are able to pay Google to get top place on a search for important keywords in a regulated industry, jumping ahead of legal comparison sites and services,” said Mark Taber, a financial consumer rights campaigner, who has been working with the FCA to highlight the problem. “Google has no liability for what it publishes, so it doesn’t seem to care.”
As a result, the FCA says it’s regularly having to spend £45,000 a month on adverts that sit above those believed to be scams. “You can imagine how deeply frustrating I find it that Google is not only earning money from these scam advertisements, but it’s also earning money from us because we then have to try and post our own adverts on Google, warning consumers about the consequences of following up these leads,” FCA chair Charles Randell told colleagues at a recent FCA meeting.
“It’s an area that needs urgent change. Change by Google and, if necessary, change through legislation.”
No vetting
Part of the frustration is that Google has the capability to stop the scam adverts but chooses not to, despite other media platforms being forced to vet potential advertisers. “If you want to advertise financial products in The Times newspaper, it will check that you are who you say you are and that you are complying with the law before letting you advertise,” Taber said. “That’s because they are liable if they published an advert for a scam.”
According to a statement from the FCA, it believes Google could use the regulator’s register to check whether a firm is authorised, or refer to its list of known unauthorised firms and scams. There are precedents in other regulated industries too.
“Look at things like licensed or prescription drugs, you are not allowed to sell them unless you’re licensed – Google knows that and so will not let anyone advertise drugs
The scammers are able to pay Google to get top place on a search for important keywords in a regulated industry
unless they are licensed, licensed,” Taber said. “Google Google could do the same thing here, but chooses not to do it.
“People are paying Google money for this placement, so the concept that Google has no control over who these people are is ludicrous.”
Taber cites a case that’s still going through legal proceedings, where a company called London Capital & Finance went bust, leaving more than 11,000 bondholders out of pocket to the tune of £237 million. Google was one of the company’s primary routes to attracting bondholders.
“They used an online marketing company, who ran sites that looked above board, but they used Google to attract victims,” he said. “They appeared to have a big company issuing savings bonds. They took £250 million (before it collapsed in 2019) and of that more than £20 million was spent advertising on Google.”
Other public departments are also spending with
Google in a bid to educate users not to fall for scams. HMRC, which has always been a magnet for fraudsters, told us it spends “significant” money with Google to appear at the top of its listings for certain search terms, but would not reveal the extent of its expenditure. It only said campaign costs were dependent on their objectives, audience, message and what actions it required customers to take.
Google said it’s planning steps to improve the situation by requiring more information from some advertisers. “Protecting users from ad scams and fraud is a key priority,” the company told us.
“To better prevent predatory financial ads in the UK, we are now requiring certain advertisers promoting financial products or services to complete our Business Operations Verification Programme. This programme will allow us to gain more information about the advertisers’ identity, business model and relationships with third parties.”
Tainted profits
In the commercial world, search manipulation has spawned a whole industry, but experts believe that Google is profiting from dubious practices by allowing firms to bid on search terms that include other firms’ trademarked names, which effectively forces the company being targeted to pay for unwanted advertising.
The practice has increased since the company moved to showing up to four adverts above “organic” results, pushing the real company out of sight if users are searching on a mobile phone. “When Google puts four paid ads ahead of the first organic result for your own brand name, you’re forced to pay up if you want to be found,” said Jason Fried, CEO of software development company Basecamp when rivals started appearing above his company in Google searches for “Basecamp”. “It’s a shake-down, it’s a ransom,” Fried added.
Despite such criticism, Google has refused to change its ways, freely admitting that account holders can use a rival’s site name in keyword bidding – whether the name is trademarked or not. Indeed, unless it receives a valid complaint, Google isn’t even bothered if companies use another company’s trademarked name in advertising copy. “It’s a grey area,” said Nadeem Azam, CEO of Azam Marketing. “It’s not generally ‘talked about’ in the marketing industry and many figures in marketing circles will even publicly turn their nose up at the practice, but it is very common and it can be very profitable.”
He added: “We get people bidding on our name and the temptation is to bid ourselves, but you do think:
‘Why should I pay 40p a click?’ It might not sound like a lot, but the ratio of people that visit the site compared to becoming paying clients would be less than 1% – we could end up paying several hundred pounds a month for traffic that doesn’t convert for us.”
This also makes it hard for startups to compete with established giants, who can afford to outbid them on their own brand. “Companies with deep pockets can saturate search engine listings, not only on brand terms, but generic keywords,” said Azam. “In the case of the latter, it is not unusual for major players to bid on millions of keywords.
“It is very much the case that bigger companies dominate the search-engine paid and organic results as they have far more money and resources, and this makes it a struggle for those with less ammunition to get known. This wasn’t the case in the early days of the internet.”
We could end up paying several hundred pounds a month for traffic that doesn’t convert for us