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SOCIAL MEDIA

Meta gets itself in more hot water in both US and Australia

By our News Team | 2022

A US court has okayed a class-action lawsuit over claims of inflated advertising metrics. Aussie’s consumer watchdog is going to court too.

A US lawsuit that accuses Facebook of deceiving advertisers is to be allowed to go ahead as a class action following a ruling in a District Court in San Francisco.

By agreeing to a class action, the ruling allows potentially millions of businesses and individuals who paid for advertising to sue the parent company, Meta, as a group. Instagram, which is owned by Meta, is also being included in the lawsuit.

The claims that are being made date back to August 2014, before the Facebook business rebranded to Meta, and accuse the social media giant of inflating its claims about advertising reach. 

According to the case made by the original complainants (who may now be joined by others as a result of the class-action ruling), executives at Facebook knew that the ‘potential reach’ metric was inflated by as much as 400%, yet did nothing to rectify the situation and preferred to cover it up.

Social Media

Image by Succo from Pixabay

The estimation of potential reach can be skewed by various factors, including duplicate and fake social media accounts.

Meta is trying to have the lawsuit dismissed, and this application will be heard in court later this year.

Aussie consumer watchdog snaps at Meta

The social media company continues to be involved in various disputes around the world. For example, last month the national consumer watchdog in Australia announced it was launching legal action against Meta, alleging it allowed scam ads to target Facebook users with fake celebrity endorsements. 

In a statement, the Australian Competition and Consumer Commission (ACCC) claimed the ads used Facebook’s algorithms to target susceptible users and included false quotes claimed to have been made by Australian celebrities.

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

“In one shocking instance, we are aware of a consumer who lost more than A$650,000 (US$480,000) due to one of these scams being falsely advertised as an investment opportunity on Facebook. This is disgraceful.”

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