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Google settles dodgy drug ads probe for $500m

US regulators have said Google will pay $500 million to avoid prosecution for running advertisements for illegal online pharmacies.

The Department of Justice was prompted to investigate Google’s advertising practices after the firm ran adverts for what it later called 'rogue' outfits on its advertising network.

Google had claimed it was having trouble identifying the 'rogue' online pharmacies, who were based in Canada but selling prescription drugs to Americans in the US.

Investigators figured that if Google can get money out of the companies it should have a pretty good idea who they are and what they are peddling. The DOJ said Google had been aware of the illegal ads since 2003.

The size of the settlement won't come as a surprise to Google, which had already set aside $500 million in its first fiscal quarterly statement this year, with which to pay anticipated settlement. The move cut its profit for to the period to $1.8 billion.