Portland probe finds Uber used software to evade 16 government officials

(Reuters) - A sweeping investigation by the city of Portland, Oregon, found that Uber Technologies Inc [UBER.UL] used a software tool to intentionally evade 16 government officials whose job it was to regulate the ride-services company, city officials said on Thursday.

When Uber began operating in Portland in December 2014, it did not have any permits, so it used a software tool it had created called Greyball to block regulators from booking rides. Uber stopped using the software after it received approval to operate its service in Portland in April 2015.

The city imposed no fines or other penalties but transportation officials have recommended that the city ramp up enforcement efforts.

“We have ensured that no attempts to evade regulators or deny service to riders” will be allowed in the future, Portland City Commissioner Dan Saltzman said in a statement.

Portland launched its investigation after the New York Times reported in March that Uber used Greyball to evade government officials in areas where its service had not yet been approved, such as Portland, Boston, Paris and Las Vegas, and in countries such as Australia, China, Italy and South Korea.

Greyball allowed Uber to ignore or cancel ride requests from locations near enforcement agencies and from accounts with credit cards believed to belong to government workers. The tool also allowed Uber to show that no cars were available.

Portland found that when Uber started operating in the city in December 2014, the company used Greyball to block 17 rider accounts, 16 of which belonged to government officials, and deny 29 ride requests by city transportation enforcement officers.

“In using Greyball, Uber has sullied its own reputation,” the Portland Bureau of Transportation wrote in its report.

A spokesman for Uber said the company was “pleased the investigation was closed” and “will continue working in partnership with the City of Portland.”

Following the Times story, Uber acknowledged the existence of Greyball and said it would put a stop to using the technology to target regulators.

The U.S. Department of Justice also opened a criminal investigation into Greyball, sources said in May.

Greyball is just one of a string of scandals Uber has weathered this year, including allegations of sexual harassment and a lawsuit threatening its self-driving car business.

Uber’s main U.S. rival, Lyft, also cooperated with the Portland investigation, but regulators found no evidence Lyft had engaged in similar tactics.