Google has blamed automatic selection and filtering in its AdWords advertising service for allowing ads for unofficial sites selling London 2012 tickets to customers in the UK.
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But the internet firm admits pocketing the revenues generated by ads for illegal sites before they are detected or reported and taken down, reveals an investigation by the BBC.
Only when ads are flagged by the filtering system does Google run a manual assessment to see if the ad conforms to policy and take it down if it does not.
Google provides an automated complaint form and responds with an automated reply to say the complaint is in a queue for investigation.
A member of the public raised the alarm after responding to a sponsored ad for LiveOlympicTickets, only to discover that the company was not an official reseller after running into difficulties.
The buyer complained to Google, but received this reply: "While Google AdWords provides a platform for companies to advertise their services, we are not responsible for, nor are we able to monitor the actions of each company." Only when contacted by the BBC, did Google remove the ad.
The Metropolitan Police is aware of LiveOlympicTickets and that the company is breaking the law, but said the company is registered overseas, and may be difficult to prosecute.
Google’s sponsored ads have put the company in hot water in the past. In August 2010, Google agreed to a $500m settlement for publishing ads for Canadian pharmacies selling illegal drugs to US customers.
Security advisors have warned consumers to be cautious about buying from companies appearing in sponsored ads without checking that it has a proper company address and VAT registration number.