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Uber Faces FBI Probe Over Program Targeting Rival Lyft (wsj.com)
258 points by WisNorCan 42 days ago | hide | past | web | 58 comments | favorite



If Papa John's calls in thousands of fake pizza delivery orders to Donimos, are they doing research on response times and how many drivers their competitor has, or are they committing a crime?


The interesting thing about this example is that literally both of those specific companies (and other QSRs with online ordering) are actively researched by hedge funds this way. You can uncover a truly magnificent amount of data by doing this with, say, their mobile apps' private APIs.

I have no idea if they do it to each other though. I'd guess not.

To make this comment even more meta: I leave it as an exercise to the reader to figure out how you can use this technique on Uber to get competitive intelligence about, for example, how many total restaurants are currently signed up for UberEats, how many have ever signed up and the rate at which more are signing up in each region. The UberEats mobile APIs offer a way to do this, though individual restaurants use non-sequential UUIDs; do this every day, break it out into a timeseries, and compare it to GrubHub. Voila, you've turned their game against them.


That depends, did Domino's pay for each pizza in full or cancel them when they made it 90% of the way there?


They'd probably still be charged. Also dominos and papa johns and even Pizza Hut don't compete in delivery zones (unless there is so much demand for pizza that it doesn't matter). The losers are the local shops. Prices are nationwide which is where the competition is. They really just want people to order a pizza delivery.

Unless your are in New York but I guess that local pizza wins. Maybe a few downtown areas as well.


If there was a Law called "Phone Fraud and Abuse Act", my answer would be "probably yes."

Whether or not you like the Computer Fraud and Abuse Act, it is the law and Uber is likely to be in contravention.


That's exactly what we have a court system to answer.


how about if Papa John's hacks Dominos computer system to make fake pizza delivery orders?


Well, good.

It's an investigation, not a definite thing. The FBI isn't charging anyone with anything, they just are saying "let's have a good look here and see if something illegal has gone on". There's lots of reasons to think they might be right, but I leave it to them to make the call.

We should want investigations into possible crimes, especially when the overall victims are consumers who will have less competition for their money.


We should want investigations into possible crimes,...

Of course. That said, though, I wish they'd keep this sort of thing private so that there is more chance folks are actually innocent until proven guilty instead of having public opinion labeling you as such before the trial.


That is not going to happen in the US - mugshots of suspects are public way before people get their day in court. I know at least 1 European country (can't remember which) that won't allow the publication of suspects' names (or was it photographs?) until they are convicted.


There's issues with going that way though - it gives the police the power to arrest and detain people in secret and prevents anybody talking about it. Historically police forces have a bad record of abusing that kind of power.

It's also going to be pretty unenforceable in the era of social media.


The abuse of power in the US is a much larger problem to be sure, and honestly that stuff has already happened [1]. And this is with the stuff supposedtly being public. Surely there are other ways that blend protecting privacy of the presumed innocent without letting up on police forces.

We can do things like keep mugshots of unconvicted people out of public view, especially on police websites and media outlets. We can quit putting folks' names on the front page when covering a story. Sure, publish arrests the cops have made with a general location, withholding people's names and addresses. We can have all cops wear body cams that may or may not be recording and release them to the public once we've blurred the person's identity.

Some of this would take changing a system. Stiff penalties to cops that break the law and are convicted. Better training. A chip sewn into uniforms (which can be laundered at the station with no need to take them home to protect the police during their personal life) to track movements. A bail system that actually looks to see if someone is a flight risk and limits on how long we can keep folks in jail. A robust public defender system (it is a right to have a lawyer, after all, even though some states make destitute folks pay for it nonetheless).

We could start public service announcements asking folks not to judge folks before they are found guilty with evidence. We could use official, licensed services to do background checks and disallow arrest records to be part of the check (probably a few exceptions for security reasons). Train police officers a bit better so they minimally can be aware of their natural biases and work against them.

I'm not saying this list is perfect nor all inclusive, but it is a start.

[1] https://www.theguardian.com/us-news/2015/oct/19/homan-square...


It's illegal in France: https://thelede.blogs.nytimes.com/2011/05/16/french-shocked-...

and I'd guess more places in Europe also.


I'm not saying I have a problem with this, but I'm not sure I'd agree with that characterization of FBI investigations.


Exactly. FBI investigations are not a "first point of contact" when a complaint has been made or someone has a question.

Some law enforcement agency has already determined that there is something worth investigating, but they don't have all the tools required to investigate it fully, so it has escalated to the FBI.

For law enforcement an FBI investigation is at least the equivalent in development terms of a priority ticket with Managers subscribing and asking for daily updates.


You are partially incorrect. The FBI only investigates federal crimes. They act as the initial point of contact for those crimes all the time. In fact, you can go to their office in San Francisco (and others I'm sure) and file a complaint in person.


This probably explains why Uber charged me $2 last time I canceled a ride with them. They need a billing paradigm that prevents them from being taken advantage of by strategies like those that they employ against their competitors.

Nevermind that the ride I canceled was 10+ minutes away, and was canceled immediately upon being booked.

Advantage: Lyft.


I cancelled a ride after he drove past me 3 times with no effort to look around at the person with luggage waving like crazy at him on the sidewalk. Got charged $5, complained and got a refund.


I prefer Lyft by far, but they do the same thing. With Uber it seems like an automatic $2 fee, whereas with Lyft you have to cancel a couple of times.


That’s not really the same thing then now is it?


Hey William, the reason Uber charges a cancellation fee is to compensate the driver for driving towards you.

Without cancellation fees, drivers would have to eat the cost of whatever progress they made towards you.

While the policy varies by city, typically an UberX or UberBLACK vehicle can be cancelled for free within 2 minutes.

UberPOOL rides typically get billed cancellations immediately, because the canceling rider may have also added to the ETA of an Uber rider already in the vehicle.

Uber will occasionally waive the cancellation fee when the ETA of a POOL pickup is significantly higher than the prediction given pre-booking.

If you believe you may be eligible for a refund, you can contact Uber support. Read more here: https://help.uber.com/h/24e75a3b-cf44-44e4-abae-8c2dce3b07a3


> Hey William, the reason Uber charges a cancellation fee is to compensate the driver for driving towards you.

Sorta? So one of the last times I cancelled a ride the driver was 8 minutes away which, not ideal, was fine. The problem was the driver was sitting at a restaurant. After 15 minutes passed he was still 8 minutes away but occasionally his car icon would move a little here and there (but staying at the restaurant).

I cancelled and it charged me a cancellation fee. Fortunately, after talking to a few friends of mine, it seems no matter why you get the cancellation fee (your fault or not) they will immediately refund it with credits if you complain.

Pretty aggravating experience, however.


Hey Kris, I'm sorry to hear that you had a bad experience, but it sounds like you were able to get your situation resolved with the support team.

The situation you describe happens pretty rarely--Uber has done over five billion trips in seven years, and typically drivers are fairly intent on finding their rider quickly and delivering a five-star experience.

In the future, perhaps various improvements to the product can mitigate the situation you describe. For example, Uber uses accelerometer data from the driver phone to improve ride safety. https://eng.uber.com/telematics/

If you have any thoughts on further improving the Uber experience, feel free to reach out.


> The situation you describe happens pretty rarely

Statistically maybe but around in the East Bay I have this happen with an Uber or Lyft driver almost once a week. The time I mentioned was just more extreme than the others (typically I wait and they start moving after a few minutes).


>The situation you describe happens pretty rarely--

Can you put a number on that? It's anecdata but I feel like watching my friends request Ubers it's like 10% of requests. It's even worse at the airport. Adding extra padding time to account for failed requests is a fairly regular use pattern.


Are things so bad at Uber that they've decided putting a PR guy on HN is a worthwhile investment?


I don't work at Uber anymore, but I visited the office recently and things look pretty good! :)

I just really love the company. I only left because my best-friend-in-the-whole-wide-world and I wanted to start a startup.

Although if the startup doesn't take off... I'd definitely consider going back to Uber.


His profile says he is an ex-engineer.


If Uber matches a driver 10 minutes away to me when there are available drivers 3 minutes away and I cancel, it seems like Uber's fault for any distance that 10 minute away driver traveled needlessly.


> Without cancellation fees, drivers would have to eat the cost of whatever progress they made towards you.

No, without it, Uber would have to eat the cost of whatever progress drivers made towards the rider.

You tell the drivers to go somewhere (And punish them when they don't) - it's on Uber to pay them.


Hilarious that there's not even a consideration that glorious Uber eats the cost. It's just that the driver would have to - obviously, who else? At some point it stops being spin and becomes some kind of ideology.


Uber eats the cost every time you contact a support agent regarding your cancellation fee (assuming that your fee is indeed credited.) :)

Automatically taking responsibility for all cancellations--whether malicious or not--would be a vector for fraud and abuse.


Yeah, just imagine what would happen if a ride sharing company were the victim of massive cancellation abuse.


Uber has the analystics, driver ratings, customer ratings, and all that other data that it needs to deal with fraud, fraud, and bad actors.

The fact that they, by default, delegate this to the customer is incredibly shitty.


Sort of.

If you're a rider or driver with a couple hundred trips, we can be sure that you're legitimate... unless your account has been hacked. Uber accounts are especially valuable to hackers, so we can imagine some percentage of legitimate accounts are making illegitimate ride requests.

If you're a first-time driver, then Uber has done a background check and a vehicle inspection, but there aren't any rider ratings, accelerometer data, etc. yet.

If you're a first-time rider using https://m.uber.com/ to take a ride on a cash-payments enabled product... then there isn't a whole lot of data to go on.

You can read more about what Uber does to prevent fraud at https://eng.uber.com/tag/fraud/

If you have tons of cool thoughts on fraud engineering and are interested in implementing those thoughts on a world-class platform, you can find fraud engineering-related jobs at https://www.uber.com/careers/list/?city=all&country=all&keyw...


> Uber has the analystics, driver ratings, customer ratings, and all that other data that it needs to deal with fraud, fraud, and bad actors

You can have all the data in the world and still make bad decisions.

Sometimes it's cheaper to just pay the customer rather than hiring more engineers to work out a fraud detection algorithm.

I think Uber has realized this.


If they realized it, they shouldn't make the customer do a chargeback to get their money in the situations posted in this thread.


Any idea why I get charged $5 when my ride circles the block a few times and never actually comes to pick me up?


That's not true. I cancelled a ride less than 1 minute after I booked it and was charged the cancellation fee.

The email they sent me even confirms that. They must code their systems to still charge the fee even when they say they wont: http://imgur.com/a/JqTgT



At this point, it would be more newsworthy to see what Uber is not being investigated for.


Making a profit?


Serious question, Who gets the proceeds of an eventual settlement? It appears that Lyft was hurt or Lyft investors and uber was committing essentially fraud. But I feel like these settlements are normally used to line the pockets of the regulatory and persecutory bodies.


These are two different things...

For a criminal probe such as this, any possible fines generally go into the administration's coffers. I know many people like to believe that prosecutors may be motivated by that money, the people making decisions on prosecution (US attorneys in this case) are so far removed from the general budget of the federal government that it's an absurd idea. The amounts are also negligible in the scheme of things.

Then, there are class action lawsuits, where the settlement is usually divided among a large number of citizen that were actually harmed, and a rather big chunk goes to the lawyer.

Note that the latter is also kinda how the system is supposed to work: almost by definition, class action lawsuits are used in cases where each individual was harmed only slightly, making an individual lawsuit too much of a hassle. The lawyers take on most of the risk of the trial.

In both cases, it's more important where the money is coming from than where it's going: the preventative effects of such costs far outstrips the importance of healing the actual harm that occurred.


Im not 100% convinced authorities are not motivated by settlement funds.

In ny, the mayor used bank settlement funds to buy iPads for police. It was a significant amount of money.

http://www1.nyc.gov/office-of-the-mayor/news/490-14/mayor-de...

Mortgage settlements were large and went to various administrative entities including prosecutors office.

https://www.nytimes.com/2016/12/23/business/dealbook/24mortg...


Even more simply, a prosecutor can point to settlement or damage amounts as a measure of their 'effectiveness' and there won't be much analysis beyond the dollar amounts involved.


Couldn't Lyft also file a civil suit?

And would that make redundant a class-action suit by Lyft shareholders?


There's also straight lawsuits, which is what lyft will probably doing to Uber.


US Attorneys need splashy settlements to brag about when they run for the Senate.


Interesting to compare this to the recent LinkedIn case that favored web scrapers. Similar techniques, only difference is Uber's approach likely had a material impact on Lyft's service and cost.

I think I'm okay with this trajectory of scraping being legally acceptable so long as no meaningful harm is done to the entity being scraped.


This is generally how I've thought about it, too.

Intent clearly also matters, and is easy to infer in many cases - scraping information looks quite a bit different than feeding a competitor's dispatch database with garbage events. Although I would love to hear a creative lawyer's story about how that was actually benign.

If you're scraping data, make sure you go out of your way to be nice to their servers. With some fragile sites, it is easier than you think to knock them over, and you really want it to appear that you're going out of your way to not cause problems. (Also, look for another role - maintaining scrapers is miserable.)


Is there any possibly that Travis will face jail time?


Paste the link in Twitter and click the first result for a non-paywall version.



Same thing basically, but there's a "Web" link underneath the title that will somewhat automate that for you.

Edit: Ok. I realised this doesn't really work for WSJ. My bad.


Non-paywall link?


WSJ will show the full article if your referer header is set to twitter.com. You can do a search on Google like so: "https://www.wsj.com/articles/uber-faces-fbi-probe-overprogra... site:twitter.com"

https://twitter.com/binarybits/status/906145108277559296


There is definitely a fierce competition between ride hailing companies for the bigger market share in the industry. Uber has already damaged its reputation by how it does business in the past. Now the new CEO Dara Khosrowshahi has more problems to solve and FBI probe on Uber is just an additional one.




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