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Google could take $500 million hit to deal with anti-trust probe

While Google had a ton of good and exciting news to talk about on Tuesday during its I/O conference, there's apparently a bit of a dark lining in their silver cloud today. Venture Beat reports that Google has admitted that the US Department of Justice is currently investigating the company, specifically with a look into Google's massive online ad business.

In a filing with the US Securities and Exchange Commission, Google stated that the Department of Justice was conducting a probe "into the use of Google advertising by certain advertisers". No other details on the investigation were revealed and Google said in its SEC filing that "we cannot predict the ultimate outcome of this matter". However that isn't stopping Google from hedging its bets. The company said that because of the probe, "we accrued $500 million for the three month period ended March 31, 2011." That likely means that if the probe goes against Google, it might have to work out a settlement deal with the government in relation to that investigation and is already preparing to pay out big bucks to do so.

As a result of this move, Google has already announced that its net income for the first quarter of 2011 will be reduced greatly, from a previously predicted $2.3 billion down to just $1.8 billion. Even with that cut in its quarterly income, Google claims, "we believe it will not have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows."

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