iYogi taken to court over alleged scam

Washington state's attorney general has filed suit against iYogi, one of the world’s largest technology support providers, for an alleged scam that often targets Microsoft users. The company, which is based in India, is accused of using deception and scare tactics to pressure consumers into buying unnecessary tech support services. Microsoft claims that iYogi is the fifth-most complained about company by its customers. Washington can seek up to $2,000 in civil penalties for each violation of the Consumer Protection Act and $100,000 per violation of the Computer Spyware Act.

Elizabeth Weise

USA TODAY

SAN FRANCISCO — Washington state's attorney general on Wednesday filed suit against one of the world's largest tech support providers for an allegedly deceptive scam that often targets Microsoft users.

The suit is against iYogi, an independent tech support provider based in India.

The company uses deception and scare tactics to pressure consumers into buying unnecessary tech support services, said Washington State Attorney General Bob Ferguson at a press conference in Seattle. The scams have cost consumers millions of dollars, says the suit.

“No one is suggesting that the entirety of their business consists of this,” said Ferguson. However some iYogi business practices, such as trying to scare users into signing up for its services “are deceptive and unlawful under Washington state law,” he said.

iYogi says the accusations are baseless.

"iYogi has attained its industry leadership by being customer focused and value driven, and our service is successful because it addresses a genuine need. We recognize that tech support frauds are a real issue in the US, and as a responsible industry leader we have been working with authorities in both countries to counter the issue. We are committed to resolving this issue in a responsible and expeditious manner,” said Vishal Dhar, company co-founder and president.

HOW IT WORKS

iYogi advertises online and has call centers in India and the United States.

According to Ferguson, when a consumer calls the company, a representative claims to provide tech support on behalf of whatever company the consumer is calling about.

For example, if they have a computer running Windows, the representative will say iYogi has a relationship with Microsoft.

With the caller's permission, the iYogi representative uses a remote access program to gain control of their computer.

The representative then finds benign files and tells the user they are infected and will damage the computer.

iYogi misleads the consumer into believing they must download iYogi's diagnostic software to discover the full extent of the problem.

The representative then produces a diagnostic report that appears on the consumer’s screen and says it has found malicious software or other serious problems on the computer.

The files the iYogi representative references are in fact generally routine programs that post no threat, Ferguson said.

The representatives then proceed to "aggressively" sell a tech support plan to fix the non-existent problems, said Ferguson. That plan costs $140 for one year or $379 for five.

iYogi also tries to sell the consumer antivirus software for $80, even if they already have antivirus software on their computer.

If the consumer is running a Windows machine but hasn't upgraded to Windows 10, the iYogi representative tries to tell them they must upgrade or their computer will be harmed.

The attorney general's office said iYogi uses scare tactics to coerce the consumer into buying Windows 10 for $80, despite the fact that Microsoft offers the upgrade for free.

MICROSOFT: WE GET MANY COMPLAINTS

“This particular company is the fifth-most complained about company by our customers to our customer phone lines,” said Brad Smith, Microsoft’s chief legal officer.

The suit was filed in King County Superior Court. It alleges that iYogi’s tactics are unfair and deceptive business practices that violate Washington’s Consumer Protection Act. The suit also alleges that the software iYogi allegedly tires to coerce users into installing onto their computers is a violation of the state’s Computer Spyware Act.

Washington can seek up to $2,000 in civil penalties for each violation of the Consumer Protection Act and $100,000 per violation of the Computer Spyware Act.