Mocality is an initiative that collects the data of business in the African nation of Kenya, allowing others to access the database and find the businesses they need. It's a crowd-sourcing program, where Mocality rewards Kenyans for sending in accurate information about local businesses. The program is designed for use on a mobile phone.
Google accessed this database in order to sell the businesses in Mocality's listing Google's own competing product. The analysis and proof are pretty damning, and offers quite a few technical explanations on how they concluded Google was behind all this. At first, some people thought it may have been a group using Google's servers (in some way) to scam Mocality, but that turned out not to be the case.
Google's Nelson Mattos has responded on Google+. "We were mortified to learn that a team of people working on a Google project improperly used Mocality's data and misrepresented our relationship with Mocality to encourage customers to create new websites," he stated, "We've already unreservedly apologised to Mocality. We're still investigating exactly how this happened, and as soon as we have all the facts, we'll be taking the appropriate action with the people involved."
This certainly isn't looking good for Google, as it's essentially a scam. It's obvious that fast-growing companies can face issues in an international market, and it's certainly possible that we're looking at a rogue group of employees in Kenya, but that's all besides the point - Google is responsible for its employees, and that's the end of it.
We'll have to wait and see what the actual details are, but it sure looks like something pretty bad is going on here. It puts the what can only be described as a crazed panic about Google+ results in search in perspective, doesn't it?