A federal investigation is allegedly underway into the ride service, Uber’s use of a secret software, 'Greyball,’ which is claimed was used to evade regulatory authorities in places where its ride-hailing service was banned or restricted.
The ride services company received a subpoena from a Northern California grand jury seeking documents concerning how the software tool functioned and where it was deployed, according to Reuters who spoke to sources familiar with the probe.
Bloomberg News reported the existence of a federal probe last week but did not class it as criminal.
Greyballing helped Uber tag some users so that they saw a different version of its standard app, which the company explained in a blog post in March helped them test new features or evade physical threats.
Current and former employees, however, told Reuters the company used the software as part of its broader Validation of Terms of Service, which analyzed credit card data, device identification, location data, and other factors to determine whether a rider was legitimate.
The data analysis might have been so broad as to mine information to see if the owner was affiliated with a credit union used by police and scanned social media profiles to assess the likelihood if a person was in law enforcement, according to Reuters.
Uber’s board has retained the law firm, Shearman & Sterling LLP, to conduct its own internal investigation into what transpired, Reuters reported
Uber and the Justice Department have declined to comment.
In March the program was exposed through a story in the New York Times after regulators were unable to catch Uber operation in places where it was banned and accused the company of obstructing their inquiries, such as Portland, Oregon.
The company received much criticism about the program when its existence was revealed in the Times' story.
In response, Uber’s lawyers sent letters to Portland authorities to explain that the Greyball technology was used “exceedingly sparingly” in that city before the service was approved in 2015.
Uber also took to its blog to explain“this program denies ride requests to users who are violating our terms of service. Whether that’s people aiming to physically harm drivers, competitors looking to disrupt our operations, or opponents who collude with officials on secret ‘stings’ meant to entrap drivers.”