cdreimer writes: According to a report in The Wall Street Journal (Warning: source may be paywalled, alternative source), Uber is under investigation by federal law-enforcement authorities for using a program called “Hell” to illegally interfere with the competition by creating fake Lyft accounts, initiating phony ride requests for Lyft drivers, and offering cash bonuses for drivers who drive for both services to leave Lyft. This is creating a new headache for incoming CEO Dara Khosrowshahi to deal with. From the report: “Federal law-enforcement authorities in New York are investigating whether Uber Technologies Inc. used software to interfere illegally with its competitors, according to people familiar with the investigation, adding to legal pressures facing the embattled ride-hailing company and its new chief executive. The investigation, led by the Federal Bureau of Investigation’s New York office and the Manhattan U.S. attorney’s office, is focused on a defunct Uber program, known internally as ‘Hell,’ that could track drivers working for rival service Lyft Inc., the people said. ‘We are cooperating with the SDNY investigation,’ said an Uber spokesman, referring to New York’s Southern District. He declined to offer additional details. Uber has never publicly discussed the details of the program. But people familiar with the matter said ‘Hell’ worked like this: Uber created fake Lyft customer accounts, tricking Lyft’s system into believing prospective customers were seeking rides in various locations around a city. That allowed Uber to see which Lyft drivers were nearby and what prices they were offering for various routes, similar to how such information appears when an authentic Lyft app is opened on a user’s smartphone, these people said. The program was also used to glean data on drivers who worked for both companies, and whom Uber could target with cash incentives to get them to leave Lyft, said these people, who added that the program was discontinued last year.”
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