Nor is an FTC probe the only pending government investigation into Uber’s conduct: Another federal agency, the Justice Department, appears to have opened a criminal probe into the company’s use of software, called “Greyball,” that essentially allowed Uber to hide rides from regulators — particularly in cities where Uber did not have permission to operate its service.
For its part, the FTC doesn’t bring criminal cases, but it can force companies — through a variety of means — to alter their business practices.
Sometimes, the agency takes action through what are called closing letters, a public acknowledgement that the FTC has looked into an incident — and could punish a company if it errs again.
In other cases, though, the FTC can file a formal legal complaint alleging a company misled its consumers, treated them unfairly or threatened corporate competitors. Those complaints are settled if a company agrees to change its practices, or they’re fought over in court if a company disputes the government’s charges.
In recent years, the FTC has brokered such settlements with the likes of Facebook, Google and Twitter, including for mishaps related to mishandling users’ data. In those cases, the agency’s punishments often have included a requirement that tech companies submit to 20 years of regular privacy checkups by the FTC.
—By Tony Romm, Recode.net.
CNBC’s parent NBCUniversal is an investor in Recode’s parent Vox, and the companies have a content-sharing arrangement.
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