Facebook says these crypto ads violate its policies and its working to curb their spread.
A few weeks ago, Australia’s richest man, Andrew Forrest, was forced to file criminal charges against Meta for allowing crypto scam ads with his name and age.
Now, the Australian Competition & Consumer Commission (ACCC) has commenced legal action against the parent company of Facebook due to its inability to curb the spread of such posts on its site.
Australia goes after Meta for crypto scam ads
Facebook has become one of the most used platforms by crypto scammers to promote fake money-making schemes. Crypto scammers have proliferated these promotions using the image and name of famous people ranging from Elon Musk to Vitalik Buterin to even those who aren’t connected to crypto like Andrew Forrest.
The consumer protection watchdog stated that the ads could have misled Facebook users who believed they were promotions by famous Australians. These ads used names and images of politicians, tv personalities, business leaders, etc., and contained links to fake media articles.
It also alleges that Facebook “aided and abetted or was knowingly concerned in false or misleading conduct and representations by the advertisers.”
ACCC has since filed the action in a federal court and would most likely be using evidence that includes the ones filed by Andrew Forrest a few weeks ago. The mining magnate criticized Facebook for allowing scammers to use his name and image for fake ads.
Normally, the Australian Securities and Investments Commission (ASIC) handles this issue. But the ACCC is filing the case due to the consumer protection element of the case.
Interestingly, Zachxbt, a famed crypto detective, tweeted about how Facebook allowed crypto “scams to run rampant” on its platform.
Proliferation of crypto scams on social media sites
The issue of crypto scammers using social media platforms to promote their illegal activities isn’t limited to Facebook alone; other popular sites like Twitter, YouTube, and Instagram have also had to deal with this menace.
According to a Federal Trade Commission (FTC) report on crypto scams on social media, unsuspecting investors lost over $700 million of their money to scams perpetrated via these sites in 2021. This, according to another FTC report, was 12 times higher than it recorded in 2020.
As of this January, crypto scams account for most online investments-related frauds.
However, these platforms have revealed their willingness to work with the authorities to curb the use of their platforms by these bad actors.
Facebook, in its defense, claimed that these ads violated its policies and that the company was working to block such posts. It added that it’s cooperating on the investigation and will defend itself appropriately.