The digital world, often seen as a haven for innovation and opportunity, is now facing serious scrutiny over the rise of cryptocurrency scams. Australia’s competition regulator, the Australian Competition and Consumer Commission (ACCC), has raised alarms about the prevalence of fraudulent crypto advertisements on Meta’s platform, Facebook. The heart of the issue? A substantial portion of these ads are alleged scams, and Meta has been accused of being aware of this situation for years.
Trust Betrayed?
Since 2018, the ACCC claims, Meta has known that a large number of cryptocurrency-related ads on Facebook were misleading or outright deceptive. The regulator’s filing with the Federal Court of Australia highlights that more than 58% of the crypto ads they reviewed breached Meta’s Advertising Policies, either through deception or by promoting scams. This paints a concerning picture of how digital advertising is managed on one of the world’s largest social media platforms.
These deceptive ads often exploit the likenesses of well-known Australian celebrities and public figures to lend credibility to fraudulent schemes. Among the names used without permission are actors Chris Hemsworth and Mel Gibson, as well as former New South Wales Premier Mike Baird. These figures’ images have been employed to mislead potential investors into crypto scams that promise high returns but leave victims empty-handed.
A particularly troubling instance was reported in February 2024, when cybersecurity firm Cybertrace alerted the public to deep fake videos of Australian mining magnate Andrew Forrest being used to promote a non-existent crypto trading app.
Meta’s Response Called Into Question
Beyond the initial findings, the ACCC’s filing raises significant concerns about Meta’s response—or lack thereof—to these scams. According to the ACCC, Meta has the technical capacity to warn users about potentially deceptive ads. However, despite this capability, Meta has not implemented such measures.
Instead, the company has adopted a reactive stance, removing individual ads only when complaints are lodged. However, the ACCC argues that Meta continues to profit from similar ads, even those featuring the same celebrities after they’ve been flagged. This has led to allegations that Meta is prioritising revenue over user safety, an accusation that could have serious legal repercussions.
In 2022, the ACCC took Meta to court, accusing the tech giant of allowing scam crypto ads to proliferate on its platform. The investigation into these practices has continued since, with no resolution yet in sight. As of now, a date for the court hearing has not been set, leaving Australians in a state of uncertainty about the outcome.
Rising Crypto Scams in Australia
This issue with misleading crypto ads is just one part of a broader problem in Australia, where there has been a sharp increase in scams, particularly those involving cryptocurrency investments. Scamwatch reports that there have been over 143,000 scam cases, resulting in losses totalling $134.47 million, with investment scams accounting for over $78 million of that sum.
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The surge in crypto-related scams has also drawn attention from AUSTRAC, the nation’s financial intelligence agency. In its 2024 Money Laundering National Risk Assessment, AUSTRAC classified cryptocurrencies as a “high” risk due to their growing association with illicit activities. A 2023 report from the Australian Financial Crimes Exchange further revealed that more than $3 billion was lost to crypto scammers in the previous year, highlighting the scale of the issue.
Australia’s Fight Against Crypto Scams
In response to the rising threat, Australian authorities have ramped up their efforts to combat crypto scams. On August 5, 2024, the Australian Federal Police launched Operation Spincaster in collaboration with blockchain forensic firm Chainalysis. The operation aims to recover crypto funds stolen from non-custodial wallets, demonstrating the government’s commitment to protecting its citizens from online fraud.
Additionally, major Australian banks have begun restricting payments to crypto exchanges, citing the increase in investment scams as a primary concern. While these measures may help curb fraud, they also raise questions about the future of cryptocurrency in Australia and whether legitimate businesses and investors might be adversely affected.
Conclusion
As the effort to curb crypto scams intensifies, it is clear that more comprehensive measures are needed to protect the public. The ACCC’s case against Meta could set a vital precedent for how social media platforms are held accountable for the content they host, particularly when it comes to potentially harmful advertisements.
For Meta, the outcome of this case could have significant implications, not just in Australia but worldwide. As governments and regulators increasingly scrutinise the role of tech companies in facilitating scams, the pressure on these platforms to take proactive steps in safeguarding their users will only grow. Whether Meta will meet this challenge remains to be seen, but for now, Australians are left waiting to see if justice will prevail and if the wave of crypto scams will finally begin to subside.
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