Google is clamping down on a fraudulent advertising network of over 125 Android apps and websites that have stolen hundreds of millions in ad dollars. A BuzzFeed report laid bare the huge scale of the scheme, which saw scammers from "We Purchase Apps" acquire established apps from developers, transferring them to a web of front and shell companies in Cyprus, Malta, British Virgin Islands, Israel, and Bulgaria. They then tracked the behavior of the apps' human users and mimicked it using a "vast network of bots," allowing them to generate fake traffic and con marketers out of millions for in-app ads (including those run by Google itself). And all the while, the real human data would mask the fake generated info, making it even harder to detect any wrongdoing. Most of the scam apps identified by BuzzFeed were games, while others included a flashlight app, a selfie app, and a healthy eating app.
This has created an opportunity for fraudsters to trick advertisers into buying inventory that does not really exist, according to Roy Rosenfield, vice president of product management at DoubleVerify. When advertisers become desperate for more inventory than what legitimately exists, fraudsters stand to benefit. "New, niche inventory formats or types, like native audio, OTT or connected TV, usually give rise to new supply sources that generally pique the interest of not only advertisers but also fraudsters," said Nicholas Seo, platforms lead of innovation at MightyHive. In a Q3 2018 study, Pixalate found that 19% of worldwide OTT impressions were invalid, due to a combination of fraud and ad serving and measurement errors caused by technical malfunctions. "Roku has its own store. Amazon has its own store. Xbox has its own store. A lot of the media companies have their own store," said Amy King, vice president product marketing at Pixalate.
Alphabet Inc.'s GOOGL -0.38% Google is issuing refunds to advertisers for ads bought through its platform that ran on sites with fake traffic, people familiar with the situation said, as the company develops a tool to give buyers more transparency about their purchases. In the past few weeks, Google has informed hundreds of marketers and ad agency partners about the issue with invalid traffic, known in the industry as "ad fraud." The ads were bought using the company's DoubleClick Bid Manager. Google's refunds amount to only a fraction of the total ad spending served to invalid traffic, which has left some advertising executives unsatisfied, the people familiar with the situation said. Google has offered to repay its "platform fee," which ad buyers said typically ranges from about 7% to 10% of the total ad buy.
A new report has uncovered a massive advertising fraud scheme that made scammers serious cash, fooled marketing companies and killed users' smartphone batteries. The scheme operated via fake banner advertisements that were secretly hidden behind legitimate banner ads in Android apps, according to BuzzFeed News. This scam was previously spotted by at least two ad fraud detection firms, Protected Media and online media verification firm DoubleVerify's ad fraud lab. A new report has uncovered a massive advertising fraud scheme that let made scammers serious cash, fooled marketing companies and killed users' smartphone batteries Fraudsters were able to hijack in-app ads in apps using Twitter's MoPub ad platform. App developers say they've received complaints of their apps draining consumers' phone batteries, BuzzFeed said, but they often can't explain the source of the battery drain.
According to Adform, the fraudsters behind the Hyphbot scheme created more than 34,000 different domain names and more than a million different URLs, many designed to attempt to fool advertisers into thinking they were buying ad inventory from big-name publishers such as the Economist, the Financial Times, The Wall Street Journal and CNN. It is a tactic known in the industry as "domain spoofing."