1.log into your Google Adwords account, when you are logged in you will need to click on the campaign tab.
2. Next you will need to click on the networks tab.
3. Once you are on the Networks tab scroll down the page and you will see exclusions on the left hand side click on the word exclusions.
4. Now you will need to click on Manage excluded IP address in the lower right hand corner and it will bring up the exclusion tool.
5. Now that you have the tool up select the campaign you want to exclude the IP from, insert the full IP address in the second box and click save.
You can only exclude 100 IP address and so far that has not been an issue for us but could be in the future. When you exclude the IP address that specific IP address will not see your ads in that campaign anymore. By doing this you will help reduce the amount of click fraud you are getting from your competitors.