Google issues refunds to advertisers whose ads ran on sites with fake traffic

Key Points
  • Google is issuing refunds to advertisers whose ads ran on its sites found to have fake traffic, according to a new report.
  • The refunds come as Google develops a tool to give online marketers more transparency into the ads they buy using the company's technology.
  • The refunds suggest that fake ads are a bigger problem than the company has previously acknowledged.
Sundar Pichai, CEO of Google
Anindito Mukherjee | Bloomberg | Getty Images

Google issued large refunds to some online marketers whose ads were placed on sites with fake traffic, suggesting its ad-buying technology may be subject to more fraud than the company previously acknowledged.

Some of the refunds were as large as "hundreds of thousands of dollars," according to a report in the Wall Street Journal.

The refunds are being made for ads bought with the company's automated technology, known as DoubleClick Bid Manager.

The company says it's working on ways to give marketers more transparency into the automated ad technology, used by advertisers to place ads across the internet on websites of Google's ad partners.

Google said last month that tests it had run "confirmed how widespread of an issue this is for publishers."

The refunds also suggest there is a downside to a recent push by Google to make it easier for advertisers on its partner sites to reach a bigger audience.

On a conference call with investors in April, Google CEO Sundar Pichai said:

"As marketers continue to shift to its programmatic ad buying, our DoubleClick platform makes it easy for them to effectively reach the right audiences. We've been focusing on making more inventory available to more advertisers, especially premium inventory."

A spokesperson for Google, a unit of Alphabet, declined to comment on the details in the Wall Street Journal report, but confirmed that the refunds were made for ads placed on partner sites with fake traffic created by bots, or automated software programs that pretend to be legitimate users.

"We can't comment on specific details of ad fraud but the vast majority is filtered in our systems before our advertisers are ever impacted or charged... In our own platforms, we're working with our exchange partners to remove monetary incentives for spammers and increase transparency for buyers," the spokesperson wrote in an email.

Read the full report in WSJ.