Aussie Mining Billionaire Sues Meta For Running Illegal Crypto Ads
One of Australia’s wealthiest men has files a criminal case against Facebook’s parent company meta for running fraudulent crypto advertising.
Andrew Forrest, the Chairman of Fortescue Metals Group, has filed a criminal case against Facebook in Australia for failing to stop crypto scam ads showing his image. This is the first time that Facebook is facing a criminal charge anywhere in the world, the billionaire said, elaborating:
“I’m doing this on behalf of innocent Australians who don’t have the resources to take on companies like Facebook.”
The Australian Competition & Consumer Commission (ACCC) has started an investigation on the matter. The ACCC Chair, Rod Sims, commented to local media:
“While Dr. Forrest’s proceedings concern similar advertisements to those that the ACCC is investigating, the ACCC’s investigation is separate and concerns different questions of law. Dr. Forrest’s proceedings have been brought under the Commonwealth Criminal Code.”
What happened?
Forrest claimed that fraudulent crypto investment ads appeared on Facebook using his image to say that Forrest has endorsed certain investment schemes, which led to many falling into the scam. Forrest’s lawyers said that Facebook “knowingly profits from this cycle of illegal ads,” leading to a violation of anti-money laundering laws.
Forrest has spent thousands of dollars since 2019 when these ads started appearing to dissociate himself from the false claims, according to his lawyers.
In November 2019, Forrest wrote an open letter asking Facebook to stop showing fake ads on the platform featuring his face as an endorsement of the crypto investment schemes. However, ads featuring celebrity testimonials continued to appear as sponsored posts, leading to the Australian financial watchdog to warn investors about fake crypto ads and sites with celebrity testimonials.
Facebook’s parent company Meta, has provided a clarification on the matter without mention specifically Forrest’s lawsuit. It stated:
“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.”
‘Cloaking’ the problem?
One common tactic for bypassing reviews and filters is called ‘cloaking.’ It is a process that lets scammers show different content when it’s being reviewed, and once approved the actual ad to run on the platforms could be different.
Forrest commented on the matter:
“I want social media companies to use more of their vast resources and billions of dollars in annual revenue to protect vulnerable people who are targeted and fall victim to these scams.”
Sims on ACCC’s behalf said:
“Like Dr. Forrest, we consider that Meta should be doing more to detect, prevent, and remove false or misleading advertisements from the Facebook platform so that consumers are not misled and scammers are prevented from reaching potential victims.”
Meta has had it struggles lately. It is expected to lose $10 billion in 2022 due to Apple making various iOS changes. Diem, the company’s stablecoin project, also officially shut down earlier this week, after it “became clear” that regulators would never give the project the light of day. They sold all the network assets to Silvergate.
