The regulator has accused Meta of engaging in false, misleading, or deceptive conduct by having scam advertisements on Facebook, which featured well-known Australian public figures
ACCC Chair Rod Sims. (Credit: Australian Competition and Consumer Commission)
The Australian Competition and Consumer Commission (ACCC) has launched legal action against Meta Platforms, Inc. and Meta Platforms Ireland for allegedly publishing scam celebrity crypto ads on Facebook.
The Australian competition regulator has instituted Federal Court proceedings against Meta. It has accused the latter of engaging in false, misleading, or deceptive conduct by having scam advertisements featuring well-known Australian public figures.
According to the ACCC, Meta’s conduct violates the Australian Consumer Law (ACL) or the Australian Securities and Investments Commission Act (ASIC Act).
The regulator is pursuing declarations, injunctions, penalties, costs, and other orders against Meta through the lawsuit.
Additionally, the regulator alleges the social technology company helped and abetted or was knowingly concerned in wrong or deceptive conduct and representations by the advertisers.
The ads in question were promoting investment in cryptocurrency or money-making schemes, said the regulator. They were expected to mislead users of the Facebook platform into believing the advertised schemes were related to prominent people featured in the ads, such as TV presenter David Koch, businessman Dick Smith, and Mike Baird, the former New South Wales Premier.
The ACCC stated that the schemes were scams and the people shown in the ads did not approve or endorse them.
Furthermore, the ads had links which took users to a fake media article that contained quotes attributed to the public figure shown in the ad endorsing a money-making or a cryptocurrency scheme.
After landing on the page, users were invited for signing up and were contacted subsequently by scammers who made repeated phone calls and used other high-pressure tactics to convince users in depositing funds into the fraud schemes.
ACCC Chair Rod Sims said: “The essence of our case is that Meta is responsible for these ads that it publishes on its platform.
“It is a key part of Meta’s business to enable advertisers to target users who are most likely to click on the link in an ad to visit the ad’s landing page, using Facebook algorithms. Those visits to landing pages from ads generate substantial revenue for Facebook.”
The regulator alleged that Meta despite being aware of the celebrity endorsement cryptocurrency scam ads shown on Facebook, did not take enough measures to address the problem.
Even after complaints from the concerned public figures, the cryptocurrency scam ads were still being promoted on Facebook, said the ACCC.