Ringtone Scams and PPC Fraud – why so little outrage?

One of my most read and commented blog posts relates to Ringtone Scams, a scandalous scourge of the internet, with collusion of most of the major phone companies. I’m confident these ringtone scams will soon be making more mainstream headlines.

Along with Pay Per Click fraud, ringtone scams, unlike some other online frauds and deceptions like phishing, have not quite made the big radar screens because they are harder to understand than traditional deceptive business practices such as bait and switch at a store or salespeople lying. In those “storefront” cases you can often confront the scamming salesperson or store directly, a powerful tool lacking in the online world.

What frustrates me is the level of tolerance for these practices, especially in the online community. Very questionable in scope and scale was the recent slap on the wrist of Google for failing to catch what appears to be massive PPC fraud – perhaps as much as a billion dollars per year. Contrary to the claims of all the PPC players much of the fraud could be eliminated with more careful screening and identification of contracted parties in the online transaction. This would eat into profits and therefore has been a low priority, but when as much as 25% of online advertising revenue may be obtained through fraud it’s time to stop expecting advertisers, often unwitting ones, to paying the price. This means the PPC outlets, especially Google who reaps the lions share of PPC profit (and therefore PPC ill gotten gains), should be paying a LOT more attention.