Click fraud involves the process of intentionally clicking ads listed on your website for the purpose of earning money rather than intending to view the products of the advertiser. Adsense involves placing ads on your website for other businesses. The way your website makes money is determined by the number of clicks to the advertiser’s link. Most websites who participate in Adsense are honest. However, the issue of click fraud is happening more often on the internet as the owner’s of some websites have found it an enticing method of generating more money from the advertisers.

With the onset of click fraud, software has been designed to analyze data based on the traffic to a website. This information is used to determine the possibility of click fraud. If you advertise this way you should invest in click fraud software or you may pay more for advertising than you should be. This software costs from $99 to $299, so it is very cost effective. It is believed as much as 20% of the cost advertisers are paying out each month is due to click fraud. With 3.2 million dollars generated each year for this type of advertising, 20% is a very high dollar amount to be losing!

A common method of click fraud involves an online robot that clicks away at the advertisements listed on a particular website. This is the quickest method. Others either do it themselves, clicking away at the ads on their own website or they hirer others to perform the task for them at a price much less than what they receive in return from the advertisers. Sometimes click fraud is done not to make money but to sabotage competitors. This is done by finding websites that advertise for them and continually click the ads. This will then cost that competitor a great deal of money they have to pay out for advertising without any hopes of generating additional sales from that cost.

Those who participate in the act of click fraud should be very careful. There are strict guidelines in place by Google to protect the reputation of their Adsense operations. Anyone caught participating in click fraud will be banned from further advertisements on their website. Google has invested 2.7 million for their Fraud Squad. They feel this investment is worthwhile though as click fraud is a serious issue. It has the potential of destroying the entire advertising industry online as we know it.

There are legal issues involved as well. A California man was charged with obtaining more than $150,000 due to click fraud in 2004. He has been indited by a Grand Jury. However, there are no state or federal laws yet against click fraud. This particular man was only indited in his scam because he came clean about it with Google in a blackmail scheme. He was going to sell his secret of how he did it to Google for another $150,000. If they didn’t give it to him he threatened to keep on doing it. If we can get state and federal laws to see click fraud as a classification of fraud with the possibility of a felony charge and jail time it may deter the amount of click fraud that takes place.

As a provider of such advertising don’t be tempted to click on the ads yourself or with an automated system. The risk of getting caught is very high as are the financial and legal repercussions. As an advertiser pay close attention to high changes in advertising costs through Adsense. Take the time to question these increases. Is it click fraud or great increases in traffic? Have sales increased? It is a great idea to invest in click fraud software as well to protect your business as well as your advertising budget.