Global: Over Half of Crypto Ads on Facebook Are Scams or Policy Violations, Australian Watchdog Reports

Australia’s competition watchdog has revealed that more than half of the cryptocurrency ads on Facebook breach Meta’s advertising policies or are outright scams. This alarming finding is based on preliminary research conducted by the Australian Competition and Consumer Commission (ACCC).

The ACCC had previously taken legal action against Meta, the parent company of Facebook, in 2022, accusing it of “aiding and abetting” fraudulent crypto ads featuring fake endorsements from celebrities. The case has yet to be heard in court, but the ACCC’s latest filing presents damning evidence against the social media giant.

In its preliminary analysis, the ACCC found that approximately 58% of the crypto ads it reviewed violated Meta’s Advertising Policies or were potentially involved in scams. These ads often featured high-profile Australians, including entrepreneur Dick Smith, former casino executive James Packer, and Hollywood actors like Chris Hemsworth, Mel Gibson, Nicole Kidman, and Russell Crowe, as well as former politician Mike Baird.

The ACCC’s investigation identified 600 ads, but it has narrowed its focus to 234, with the potential to uncover more instances of fraudulent activity during the discovery process.

Investment scams, including those promoted through misleading crypto ads, have been a major source of financial loss for Australians. According to Scamwatch, an Australian Government website, investment scams have cost Australians over $78 million in 2024 alone, with 3,456 reports filed so far this year.

The regulator argues that Meta has been aware of these deceptive practices since at least January 2018. Despite this, the ACCC alleges that Meta has continued to allow such ads to run, profiting from them even as it sporadically removes individual ads and bans associated accounts after receiving complaints. The watchdog contends that Meta could have developed or implemented technology to flag suspicious ads and warn users, but has failed to do so effectively.

In December 2023, Australian mining tycoon Andrew Forrest filed a lawsuit against Meta over Facebook ads that used deepfake images of him to promote scam crypto schemes. Although the case was initially dismissed, a U.S. judge allowed it to proceed in June 2024, highlighting the ongoing legal challenges Meta faces over its ad practices.

Meta claims that it invests in “products and support systems to keep scammers out” and reports that it took action on 691 million fake accounts in the fourth quarter of 2023. This figure is down from 827 million in the previous quarter and significantly lower than the 2.2 billion fake profiles removed in 2019, according to Statista.

As the ACCC continues its investigation, the spotlight remains on Meta’s responsibility to protect users from misleading and deceptive advertising practices on its platform.