Today’s Cache | Meta’s crypto tangle

Today’s Cache is a daily column dissecting big themes at the intersection of technology, business and policy.

Updated - March 21, 2022 02:10 pm IST

Published - March 18, 2022 05:19 pm IST

File photo.

File photo.

Scam ads are not new to the digital world. Scamsters have been stealing money and login credentials from unsuspecting consumers for as long as the Internet has been around. Cybercriminals have now honed their skills and manipulation techniques, and are now promoting fake crypto ads on various social networking platforms and search sites.

The latest scam they’ve deployed is promoting bitcoin ads with prominent personalities’ names or images without their consent. And once the user clicks the link on the ad, they are taken to a fake news story that includes a link purporting to be a cryptocurrency investment scheme.

Scam crypto ads have lured away tens of thousands of Australians, and these ads are promoted by a highly organised global business that uses five addresses in the centre of Moscow, according to a report by the Guardian.

The massive scale of these scams makes it difficult for several platforms to pull down the ads. But still, Australia’s antitrust regulator has singled out Facebook-owner Meta Platforms Inc.

The regulator has filed a lawsuit against Meta for allowing such scam advertisemets to be promoted on its platform.

The lawsuit alleges that the social network engaged in false, misleading or deceptive conduct by publishing scam ads featuring prominent public figures This behaviour was in breach of the Australian Consumer Law or Australian Securities and Investments Commission Act, the Australian Competition and Consumer Commission (ACCC) said in a statement.

“In one shocking instance, we are aware of a consumer who lost more than $650,000 due to one of these scams being falsely advertised as an investment opportunity on Facebook. This is disgraceful,” ACCC Chair Rod Sims said.

The commission noted that the ads published on Facebook promoted investment in cryptocurrency or money-making schemes, which were likely to mislead users into believing the schemes were associated with well-known people featured in the ads. But the high-profile people in those ads had never approved or endorsed the ads or cryptocurrencies.

The key part of Meta’s business is to enable advertisers, through its algorithm, to target users who are most likely to click on a link to an ad. Those clicks leading to various landing pages from ads generate substantial revenue for Facebook.

ACCC also noted that Facebook was aware that fake celebrity endorsing cryptocurrency scam ads were being displayed on its platform but failed to take sufficient steps to address the issue. This despite the prominent personalities complaining that their names and images were being used in ads without their consent. 

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