On Friday, Australia’s competition watchdog launched a case against Facebook owner Meta Platforms, alleging that the social media giant failed to prevent scammers from promoting fraudulent ads starring celebrities on its platform.
The adverts, which encouraged cryptocurrency or money-making schemes, may have caused Facebook users to believe that they were promoted by celebrities, according to the Australian Competition and Consumer Commission (ACCC).
According to the lawsuit filed in Federal Court by the ACCC, Facebook ‘aided and abetted or was knowingly concerned in fraudulent or misleading behaviour and representations by the advertisers.’
‘The essence of our argument is that Meta is liable for the advertisements it posts on its platform,’ stated ACCC Chair Rod Sims. ‘It is alleged that Meta was aware that fraudulent ads were being displayed on Facebook but did not take adequate actions to remedy the problem.’
Meta said that any ads that defrauded people or misled users were against its policies, and that the company uses technology to detect and block such posts. It also said that it had ‘cooperated with the ACCC’s investigation into this matter to date.’
‘We will evaluate the ACCC’s recent submission and expect to defend the proceedings,’ a Meta representative said in an emailed statement, declining to say more because the case was still pending in court.
According to the ACCC, the adverts featured photographs of many Australian corporate executives, TV hosts, and politicians, as well as links to phoney media articles with statements ascribed to the individuals.
Scammers contacted users who had joined up to persuade them to deposit money into the phoney schemes, according to the authority.
‘We are aware of a consumer who has lost almost A$650,000 ($480,000) as a result of one of these scams,’ Sims said.
Last month, Australian iron ore mogul Andrew Forrest, chairman of Fortescue Metals Group, filed a criminal complaint against Facebook for scam advertising that used his image to promote cryptocurrency schemes.
Financial fraud accusations are normally handled by the business regulator, the Australian Securities and Investments Commission (ASIC). The ACCC said that it was given interim powers to initiate the complaint since it is pursuing financial penalties.
Facebook established a programme earlier this week to help train Australian political candidates and influencers on cyber security in order to prevent the spread of potential misinformation during the country’s forthcoming federal election campaign.
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