Australian regulator has sued Meta over ‘scam’ cryptocurrency ads. The Australian Competition and Consumer Commission (ACCC) launched a lawsuit against Facebook owner Meta Platforms (FB.O), alleging that the social media giant failed to prevent scammers from using its platform to promote fraudulent ads starring celebrities.
The platform’s turbulent relationship with crypto-related ads began in 2018 when it outlawed the promotion of most blockchain- and crypto-related content. However, it later decided to include only initial coin offerings.
Before promoting trading platforms, software, and related services and goods that allow cryptocurrency to be monetized, resold, swapped, or staked, companies must receive written approval from the platform.
The Australian Competition and Consumer Commission (ACCC) declared on Thursday that Meta had broken Australian consumer law by allowing deceptive advertisements of “prominent Australian public personalities” supporting cryptocurrency.
The regulator stated, “It is alleged that Meta was aware that celebrity endorsement bitcoin fraud ads were being published on Facebook but did not take necessary actions to remedy the matter.”
The advertising was likely to “mislead” Facebook users into thinking the schemes were linked to well-known people such as businessman Dick Smith and TV host David Koch, according to the watchdog.
The regulator claims that advertisements on the platform included links that directed users to fake media stories featuring well-known Australian public figures advocating crypto fraud.
Andrew ‘Twiggy’ Forrest, an Australian millionaire, filed criminal charges against Meta’s platform in February, stating that it failed to take precautionary steps against bogus crypto adverts that utilized his image.
They were hoaxes, according to the authorities, and the celebrities portrayed in them did not approve or endorse them. “The essence of our argument is that Meta is liable for the advertisements it posts on its platform,” stated ACCC Chair Rod Sims. “Using Facebook algorithms, Meta’s company allows marketers to target viewers who are most likely to click on a link in an ad and visit the ad’s landing page.”
Sims went on to say that ad-driven traffic to landing pages generated “significant revenue” for Facebook. Financial fraud allegations are usually handled by the Australian Securities and Investments Commission, a business regulator (ASIC). Because the ACCC is pursuing financial penalties, it was given provisional powers to file the complaint.
Facebook launched a program earlier this week to help political candidates and influencers in Australia learn about cyber security in order to minimize the spread of potentially harmful disinformation during the country’s upcoming federal election campaign.
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