Australia’s competition watchdog has sued Facebook owner
Meta Platforms and Meta Platforms Ireland, alleging that the social media giant
failed to prevent scammers using its platform to promote fake ads featuring
well-known people.

The Australian Competition and Consumer Commission (ACCC)
alleges that the ads, which promoted investment in cryptocurrency or
money-making schemes, were likely to mislead Facebook users into believing the
advertised schemes were associated with well-known people featured in the ads.

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According to a Reuters report, the schemes were in fact scams, and the people
featured in the ads had never approved and endorsed them.

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.
Meta was allegedly aware that scam ads were being displayed on Facebook but did
not take adequate measures to stop them.

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“The essence of our case is that Meta is responsible for
these ads that it publishes on its platform,” ACCC Chair Rod Sims said. “

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. It added that it had cooperated with the ACCC’s
investigation into this matter to date.

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 “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 the court, reported Reuters.

The ACCC said the ads featured images of business
leaders, TV hosts, and politicians and linked to fake media articles containing
quotes that were attributed to the personalities.

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According to the regulator, scammers contacted the users
to convince them to deposit funds into the fake schemes.

“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.

Iron ore magnate Andrew Forrest, chairman of Fortescue
Metals Group, filed criminal charges against Facebook last month over scam ads,
including those using his image to promote cryptocurrency schemes.

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Usually, the corporate regulator, the Australian
Securities and Investments Commission (ASIC), handles financial fraud
complaints against companies. The ACCC said it was given temporary powers to
file the lawsuit. It is seeking unspecified declarations, injunctions,
penalties, costs and other orders.