The tech firm sued to block the federal watchdog agency's move, claiming it was regulatory overreach.
The Consumer Financial Protection Bureau announced on Friday it had placed Google under federal supervision, a move that could subject the tech giant to the sort of regular inspections and other rigorous monitoring typically imposed on major banks.
The order prompted Google to file an immediate lawsuit against the federal watchdog agency, seeking to block its oversight. The company claimed the CFPB and its director, Rohit Chopra, had relied on "unsubstantiated" consumer complaints to justify an action that amounted to regulatory overreach.
Formed in the wake of the 2008 banking crisis, the CFPB has broad power to protect consumers from unfair, deceptive or predatory financial practices. That includes monitoring banks as well as digital firms offering comparable services -- including the wide array of smartphone apps and other tools that help users pay for goods or send money to friends.
On Friday, the CFPB specifically raised concerns with one of Google's financial products, Google Pay, which allowed users to make payments and store money until the company largely shut it down in the United States earlier this year. The agency said it had received a number of complaints from users -- about erroneous transactions involving their Google Pay accounts and trouble obtaining the company's help with them -- prompting regulators to intervene.
The CFPB said its order does not mean that Google broke the law. By seeking to supervise some of Google's products, however, the bureau would gain the power to conduct on-site reviews and examine private documents and communications to ensure it protects consumers' finances. Federal investigators can also seek changes to Google's practices if they find problems in the future.
But Google argued in its lawsuit Friday that the bureau had "cherry picked" findings about "a product it no longer offers." The company said that Congress had never authorized the agency to conduct such oversight, and it pointed to the bureau's own finding that Google had not engaged in any illegal activity.
"This is a clear case of government overreach involving Google Pay peer-to-peer payments, which never raised risks and is no longer provided [blog.google] in the U.S., and we are challenging it in court," José Castañeda, a spokesman for Google, said in a statement.
The supervision order arrived days after the CFPB took broad steps that would allow it to place other large tech companies and their financial products under heightened federal oversight. Lobbying groups for Amazon, Apple, Google and other companies that faced potential oversight had fought vigorously against the rules. (Amazon founder Jeff Bezos owns The Washington Post.)
The Post first reported last month that the CFPB was expected to act against Google.