City officials: Criminal probe into Uber reaches Austin

A U.S. Department of Justice criminal investigation into Uber’s operations now includes how the company operated in Austin, officials confirmed Monday.

A city spokesman confirmed that Justice Department officials contacted staffers at Austin’s Transportation Department and Aviation Department seeking information about Uber’s operations and regulatory information while the ride-hailing behemoth provided rides in Austin. Those departments oversee how ride-hailing companies and taxicabs operate in the city and at the airport.

ROAD TEST: We put six Austin ride-hailing apps to the test. Which is best?

On Friday, Reuters first reported that the Justice Department had launched a criminal investigation into a controversial Uber software program called Greyball. According to The New York Times, Uber used the software in cities where it had been prohibited from operating, helping it avoid detection by police or code enforcement officers trying to catch the ride-hailing company violating local laws.

Uber began providing rides June 3, 2014, without Austin’s approval, a few days after Lyft did so. It wasn’t until October 2014 that the City Council approved rules allowing ride-hailing companies to operate under certain restrictions. Both companies left the Austin market in May 2016 after voters rejected a referendum on rules that Uber and Lyft preferred.

HOW WE GOT HERE: A timeline of events during Uber’s tenure in Austin

Austin spokesman Bryce Bencivengo said that Justice Department officials indicated they would be sending subpoenas for information related to Uber’s operations.

“They indicated that they have contacted other cities looking for similar information and the subpoenas were forthcoming, but they have not arrived yet,” he said, adding that Austin will cooperate with the investigation.

However, the federal officials made no mention to Austin officials of Uber’s Greyball program.

The Justice Department probe could look at the four months in 2014 when Uber operated illegally in Austin. During that time, dozens of drivers were cited and several vehicles were impounded by city officials.

In December 2014, the company used Greyball to elude transportation authorities while it operated illegally in Portland, Ore., Reuters reported. Federal investigators have also contacted Philadelphia officials about Uber’s use of Greyball in that city.

Greyball essentially mines Uber users’ data from personal accounts to determine whether the person trying to hail a ride might be associated with a police department or government agency.

The company would check to see if customers often opened the app near certain government buildings or if they might have a credit card associated with a police credit union. It would also cull social media accounts, the Times reported.

If Uber determined the person might be involved with a police or government agency that might be watching it, that customer would be “Greyballed,” and attempts to hail drivers would be unsuccessful, as the app would hide the location of its drivers.

The company acknowledged the existence of Greyball after the Times story in March but has said the program was created to verify ride requests and protect drivers. Uber also said at the time that it was prohibiting employees from using the software to sidestep local regulators.

It is too early in the criminal investigation to say what charges might be involved or how likely it is that any charges will be filed, Reuters reported.

Former Austin City Council Member Laura Morrison, a critic of Uber since it arrived in Austin and a leader in the campaign to defeat Proposition 1 last year, said it was “beyond fathomable” and “more than irksome” that the company could have actively worked to thwart the enforcement of laws in Austin.

“It just goes on and on,” she said, noting that harassment allegations and video of the Uber CEO berating a driver have also surfaced in recent months. “These aren’t just black eyes to me. It’s the kind of company that is just unfortunate that it exists.”

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