Eric Schmidt, chief executive officer of Google Inc. Google has asked Brazil to appoint an expert to independently verify claims against its subsidiary. - Reuters

SAO PAULO, Brazil (AP):

Prosecutors have threatened to shut down the Brazilian subsidiary of Google Inc, claiming the company's social networking service, Orkut, promotes child pornography and encourages hate crimes, officials said Wednesday.

Prosecutors said in a statement that Google has refused to turn over information needed to identify individuals "who use Orkut to divulge shocking images of child pornography and manifestations of hate toward blacks, Jews and homosexuals."

In a motion filed Tuesday, prosecutors proposed the company be fined 200,000 reals (US$95,000; euro74,150) daily until it provides the information.

They are also seeking 130 million reals (US$61 million; euro47.6 million) in "moral damages" from Google's Brazilian unit.

If Google's local office still refuses to provide the information, "the federal prosecutor's office asks that the subsidiary be dissolved," the statement said.

It said the company has not complied to 38 requests for information issued by federal courts. It said Google argues that the required data is not in Brazil but stored overseas by the US-based parent company Google Inc.

In response, Google Inc said in a statement that it has asked a court "to appoint an expert to independently verify that Google Brazil does not maintain Orkut.com user information."

"This legal measure was taken to show that ... Google Brazil does not host either the databanks of the virtual community Orkut or information about its users," the statement said.

Confident

"Google Inc. is confident that the findings of the expert will convince the Brazilian prosecutor, who continues to threaten action against Google Brazil, that Google Brazil does not have the information sought and should not be the target of any action," it added.

Durval de Noronha, the attorney for Google's Brazilian subsidiary said in a conference call with reporters that the company "is doing all it can to cooperate with the investigation" and that it has so far complied with 15 of 19 requests for information made by federal courts. The remaining four are being processed.

He said all 19 requests had been addressed to Google Inc. He did not explain the discrepancy between his figures and those of the federal prosecutors.