Australian watchdog sues Facebook’s Meta over fake advertisements that feature well-known people

Facebook’s Meta Platforms has credibility and consumer trust issues. It’s unfortunate that Mark Zuckerberg and others within the company don’t seem to be aware of the public’s perceptions. As we reported back in January, France’s data privacy watchdog CNIL fined Meta and Google $237 million for cookie breaches and for making it difficult for EU internet users to easily reject online trackers.

Fast forward three months later. Australia’s competition watchdog today filed a lawsuit against Meta, alleging the social media giant failed to prevent scammers using its platform to promote fake ads featuring well-known people.

The Australian Competition & Consumer Commission (ACCC) said the advertisements, which endorsed investment in cryptocurrency or money-making schemes, could have misled Facebook users into believing they were promoted by famous Australians.

The ACCC also alleges in the lawsuit filed in the Federal Court that Facebook “aided and abetted or was knowingly concerned in false or misleading conduct and representations by the advertisers.”

“The essence of our case is that Meta is responsible for these ads that it publishes on its platform,” ACCC Chair Rod Sims said. “It is alleged that Meta was aware … scam ads were being displayed on Facebook but did not take sufficient steps to address the issue.”

“We are aware of a consumer who lost more than A$650,000 ($480,000) due to one of these scams … this is disgraceful,” Sims added.

Meta spokesperson said that the company does not condone any ads that scammed people out of money or misled users. Meta said that posting fake ads on its platform violates its policies. The social giant also explained that it uses technology to detect and block such posts, adding it had “cooperated with the ACCC’s investigation into this matter to date.”

Last month, chairman of Fortescue Metals Group Andrew Forrest launched criminal proceedings against Facebook last month over scam ads, including ones using his image to promote cryptocurrency schemes.

Meanwhile, a Meta spokesperson said in an emailed statement: “We will review the recent filing by the ACCC and intend to defend the proceedings.” The spokesperson declined to comment further as the case was before the court.

The ACCC alleged the fake Facebook ads used images of several Australian business leaders, TV hosts, and politicians and contained links to fake media articles that included quotes attributed to the personalities. The users who signed up were later contacted by scam artists to convince them to deposit funds into the fake schemes, the regulator said, according to a report from Reuters.