Meta hit with lawsuit over failure to squash crypto scams

The Meta logo on a smartphone in front of the Facebook logo a little bit blurred in the background
(Image credit: Shutterstock / rafapress)

Facebook parent company Meta is facing a lawsuit in Australia that claims it failed to prevent the showing of ads that promoted cryptocurrency scams. 

The Australian Competition & Consumer Commission (ACCC) alleges the company broke laws prohibiting false, misleading, or deceptive conduct, as well as laws regulating investing.

According to the report, there seem to have been multiple ads, showing celebrities, politicians, and television hosts, promoting various fraudulent money-making schemes. None of those people consented to their image being used that way, also making a case for identity theft.

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Facebook denies responsibility

The people that fell for the scam, and registered an account with these fraudulent services, were also under “high-pressure tactics”, including repeated phone calls, forcing them to deposit, and ultimately lose, their money.

One person allegedly lost almost half a million dollars, the ACCC claims. 

"We allege that the technology of Meta enabled these ads to be targeted to users most likely to engage with the ads, that Meta assured its users it would detect and prevent spam and promote safety on Facebook, but it failed to prevent the publication of other similar celebrity endorsement cryptocurrency scam ads on its pages or warn users," The Register cited Rod Sims, chair of the ACCC, saying.

"The essence of our case is that Meta is responsible for these ads that it publishes on its platform," Sims added. "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. Meta should have been doing more to detect and then remove false or misleading ads on Facebook, to prevent consumers from falling victim to ruthless scammers."

In response to the lawsuit, Meta told The Register that it rejects the idea of deliberately allowing these ads on the platform, and that it will work with the ACCC and defend the proceedings. 

"We don't want ads seeking to scam people out of money or mislead people on Facebook – they violate our policies and are not good for our community. We use technology to detect and block scam ads and work to get ahead of scammers' attempts to evade our detection systems,” Facebook said. 

Via: The Register

Sead Fadilpašić

Sead is a seasoned freelance journalist based in Sarajevo, Bosnia and Herzegovina. He writes about IT (cloud, IoT, 5G, VPN) and cybersecurity (ransomware, data breaches, laws and regulations). In his career, spanning more than a decade, he’s written for numerous media outlets, including Al Jazeera Balkans. He’s also held several modules on content writing for Represent Communications.