Reuters filed a lawsuit against Facebook owner Meta Platforms, alleging that the social media giant failed to prevent scammers from promoting fake ads featuring celebrities on its platform.
The advertisements, which endorsed cryptocurrency or money-making schemes, may have led Facebook users to believe they were promoted by celebrities, according to the Australian Competition and Consumer Commission (ACCC).
The lawsuit filed in the Federal Court also alleges Facebook “aided and abetted or was knowingly concerned in false or misleading conduct and representations by the advertisers,” the ACCC said in a statement.
“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.”
Meta said any ads that scammed people out of money or misled users violated its policies and the company uses technology to detect and block such posts, adding it had “cooperated with the ACCC’s investigation into this matter to date.”
“We will review the recent filing by the ACCC and intend to defend the proceedings,” a Meta spokesperson said in an emailed statement, declining to comment further as the case was before court.
The ACCC said the 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.
Users who signed up were contacted by scammers to convince them to deposit funds into the fake schemes, the regulator said.
“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 said.
Last month, Australian iron ore magnate Andrew Forrest, chairman of Fortescue Metals Group, filed criminal charges against Facebook over scam ads that used his image to promote cryptocurrency schemes.
Financial fraud complaints are usually handled by the corporate regulator, the Australian Securities and Investments Commission (ASIC). The ACCC said it was given temporary powers to file the lawsuit because it is seeking financial penalties.
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