The Australian competition watchdog is suing Meta, Facebook’s parent company, for publishing “scam celebrity cryptocurrency ads”.
was accused of running advertisements that encouraged people to invest cryptocurrency and other money-making strategies that were actually scams. One consumer lost more than $650,000 (PS365).
According to the Australian Competition and Consumer Commission, the celebrities featured in the ads had “never approved or endorsed” them. The commission announced court proceedings against Friday.
Continue reading: The public is warned about criminals using celebrities as a platform to promote fake investments
Facebook’s ads in Australia led users to “a fake media article” that contained quotes from the person featured in the ad.
The watchdog said that scammers contacted users and asked them to sign up. They used high-pressure tactics such as repeated phone calls to convince them to deposit money into fake schemes.
Rod Sims, the chair of the regulator, launched the action on his final day at the regulator. He stated: “The essence is that Meta is responsible to these ads it publishes on their platform.”
It is being accused that the social media platform knew about the celebrity endorsement scams being conducted on Facebook, but didn’t do enough to address it.
Meta spokesperson said that they don’t allow ads to deceive people or mislead them on Facebook. These are violations of our policies and not good for the community.
They added that technology is used to block scam ads and to catch scammers trying to evade our detection systems.
“We have cooperated with the ACCC in this investigation to date. We will examine the ACCC’s recent filing and we intend to defend the proceedings.
They concluded that they were unable to comment further on the details of the case because it is before the Federal Court.
This comes as technology companies in UK are required to combat scam advertisements by the new Online Safety Bill.
Martin Lewis, founder of MoneySavingExpert UK , previously settled a lawsuit against Facebook regarding fraudulent advertisements featuring his name or image. Andrew Forrest, an Australian mining tycoon, is currently suing Facebook in the same case.
The government has been accused by the treasury committee of failings to address an alarming rise in fraud throughout the country.
The MPs recommended that online companies like Meta and Google pay compensation for people who fell for scams through their platforms.
The MPs pointed out that the companies were being paid compensation but they were also receiving advertising money from the government to warn people about the scams.
Between 2019 and 2021, the Financial Conduct Authority paid more that PS1.1m to companies like Meta, Twitter, TikTok, and Google to run anti-scam ads.
In a move that the MPs considered appropriate, Google offered $3m (PS2.2m), in advertising credits to the regulator.