Uber found itself in more hot water on Thursday after Reuters revealed that the ride-hailing service is facing a criminal investigation by the U.S. government.
The Department of Justice has reportedly begun an investigation over the company’s use of “secret” software that allowed its drivers to operate in areas where Uber was banned or restricted.
First reported by The New York Times, the so-called “greyball” software is said to have allowed the company to identify officials seeking to prevent the service from running. It is claimed the software was used in several areas including Portland and Oregon, where the service was still waiting for approval to operate.
Transport regulation officials regularly posed as passengers in those regions where Uber had yet to obtain approval, in an effort to prove that Uber was operating illegally. The software was used to work out who was an undercover official and would attempt to block them from booking rides in the first place.
Uber has already admitted to using the software. In a letter sent to Portland transport regulators last week, the company said it used greyball “exceedingly sparingly” in the city, but had not used it since April 2015 when it received permission to operate.
Uber has also previously defended its use of the software by claiming that it helped the company limit fraud and protect its drivers from harm. The company prohibited the use of the software for identifying officials shortly after the New York Times report brought the practice to light.
The nature of any potential federal criminal violation, and the likelihood of anyone being charged, remains unclear because the investigation is still in its early stages, according to sources. However, Uber has reportedly received a subpoena from a Northern California grand jury seeking documents concerning how the software tool functioned and where it was deployed. A subpoena indicates that an official criminal investigation is underway.
Uber has come under increasing pressure on several fronts in recent months following several controversies. Concerns were first raised late last year when users complained that the app appeared to track them for days or even weeks after they last used the ride-hailing service.
Recently it emerged that Apple CEO Tim Cook threatened to pull Uber’s app from the App Store in early 2015 after discovering that it was secretly “fingerprinting” iPhones that used the app. The revelation came in a New York Times article published last month that detailed the ride-hailing service’s history of controversial business tactics.
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