The Washington Post reports that a new PPC fraud lawsuit has been filed this week against Yahoo. Interestingly, the complaint cites a new flavor of click fraud (called “Syndication Fraud” in the suit) that involves Yahoo’s alleged partnership with spyware companies and typosquatters to unjustly drive up click revenues. One of the attorneys in the case, Ben Edelman, highlighted these practices here.

The complaint cites a classic example at www.expedai.com of how typosquatters are partnering with Yahoo, using its syndicated PPC advertising as a tool to collect click tolls from unsuspecting users who type in a wrong address. In the example cited, Expedia’s own PPC ad is included and I’m sure lots of vistors click on this Expedia ad without realizing their poor spelling just cost Expedia $. What a waste.

Lawsuits like this will raise awareness, but until we change the underlying PPC system to add transparency (so users understand when they click on the Expedia link they just charged them a fee) or better yet align the underlying incentives between advertiser and intermediary, these practices will continue.

This entry was posted on Wednesday, May 3rd, 2006 at 9:47 am and is filed under Click Fraud. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.