Google suspended hundreds of accounts used by people trying to take advantage of a US sales tax loophole in order to make a profit on the resale of Pixel phones. Although the accounts were restored after a few days, this creates an unsettling precedent for Google users.
Members of the site Dan’s Deals report that they were locked out of their Google accounts after trying to resell Pixel phones. The lockouts caused them to lose access to Gmail, Google Drive, Google Photos, and other Google services. The situation also prevents the affected users from being able to authenticate logins for other accounts. About 200 of those affected received emails stating all of their data would be deleted, if they did not successfully appeal their suspension.
The locked out users were reportedly buying phones from the Google’s Project Fi mobile carrier and shipping them to a reseller Dan’s Deals in New Hampshire, a business that operates from a state with no sales tax. The reseller promised to split the profit from the resale with the original customers. The site had been exploiting the tax loophole for years with the previous Android phones, and it says it never had any issues.
In a statement to Gizmodo, a Google spokesperson said:
We identified a scheme in which consumers were asked to purchase Pixel devices on behalf of a reseller, who then marked-up the cost of those devices in order to resell them to other customers. We prohibit the commercial resale of devices purchased through Project Fi or the Google Store so everyone has an equal opportunity to purchase devices at a fair price. Many of the accounts suspended were created for the sole purpose of this scheme, but since some customers were not aware of these Terms of Sale and are now locked out of many Google services they rely on, we’re restoring access to these customers’ accounts.
It’s not all that uncommon for technology sites to suspend accounts for violating terms of service, but a conglomerate such as Google can often overcompensate for bad behaviour by punishing people too hard for minor infractions. People are entangled in the company’s services, and such far-reaching bans can have huge impacts on people’s lives.
Luckily for these customers, not all hope has been lost. Dan’s Deals is reporting that the suspended accounts have been reactivated. Here is the message they reportedly received:
Hello Google user,
Your Google Account was suspended as part of our fraud prevention efforts, based on violations of our Terms of Service and Terms of Sale for Devices. After reviewing your appeal, we are re-enabling your account.
Google takes violations of our terms very seriously, and we ask that you review relevant terms and product policies to ensure that you understand them. Repeated violations of our terms may lead to account termination.
In order to access your Google account, please sign in. When you sign in, you will be asked to verify a security code via SMS. Once you verify the code, you will be able to access your account again.
Last but not least, we wanted to remind you that Google users can always export and download their data from Google products like Gmail, Photos, and Drive while their account is active. In a few easy steps, you can create an archive to keep for your records or backup your data to another service. More information about backing up your data can be found at google.com/takeout.
The entire story is unusual, and shows how Google is trying to take more control over product distribution. Obviously, the creation of the Pixel phone alone is a good indicator that the company wants to take more control over Android phone sales in general—but this shows that Google is getting very serious about how people buy into the Android experience.