Need to know
- Criminals who infiltrated social media platforms stole $95 million from Australians in 2023, up 249% since 2020
- 76% of those 2023 losses happened because victims clicked on a scam ad on a Meta-owned platform
- Meta recently announced it will introduce an advertiser verification system in Australia to take effect in February next year
When CHOICE went looking for scam ads on popular social media platforms last year, we didn't have to look that hard. Many of them were the sponsored ads that come up first in search results.
We also heard from a number of online shoppers who had clicked through some of these slickly designed traps and then ordered goods from websites spoofing some of Australia's most popular retailers. They knew they'd been scammed when they ended up with nothing.
The number of scam ads was troubling, but even worse was the galling fact that platforms such as Facebook faced no consequences for hosting them
These were comparatively small losses. Others clicked on scam ads offering financial advice or investment opportunities and lost millions. Many of these ads were deepfakes featuring prominent Australians. In terms of losses, investment scams far outweigh all other types. Last year, Australians parted ways with a reported $1.3 billion.
The number of scam ads was troubling, but even worse was the galling fact that platforms such as Facebook faced no consequences for hosting them, at least not in Australia. The online platforms accepted the scammers' ad money and left platform users to fend for themselves. Many fell prey to their increasingly sophisticated tactics.
Meta under pressure
Criminals who infiltrated social media platforms stole $95 million from Australians in 2023, up 249% since 2020. And 76% of those 2023 losses happened because victims clicked on a scam ad on a Meta-owned platform, such as Facebook and Instagram.
Things have gotten better in 2024 but are still far from good enough. Between January and September 2024, Australians had reported losses of $35 million from social media scams.
The more than 21 million Australians with Facebook accounts have long been left at the mercy of the scammers
Meta has been under pressure in recent years from both the Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) to stop the scammers from hijacking its platforms.
The company has the knowhow, and has taken steps to do this in other countries.
But the more than 21 million Australians with Facebook accounts have long been left at the mercy of the scammers – which is one of the reasons we recently handed Meta a Shonky Award.
Meta says advertisers will now be verified
A recent announcement by the company raises hopes that scammers will find it harder to target victims, at least when it comes to investment and other financial services scams.
Meta says it will introduce an advertiser verification system in Australia to take effect in February next year.
Advertisers targeting Australians with financial services offers will have to take several steps to demonstrate that they're not scammers, including providing their Australian financial services licence number and uploading business documents. Facebook users will be able to review these materials before engaging with the ad.
We urgently need strong laws to require the tech giants to do more to prevent scams
CHOICE campaigns director Rosie Thomas
Finance ads will also have to feature a disclaimer indicating who paid for the ad or who stands to benefit from it.
"Meta's move to finally turn on such a simple protection against investment scams is overdue," says CHOICE campaigns director Rosie Thomas.
"We urgently need strong laws to require the tech giants to do more to prevent scams. Relying on voluntary commitments is too slow and leaves everyone vulnerable to scammers."
The timing of the move by Meta in its Australian market is no accident. Legislation is currently before parliament that will make it mandatory for digital platforms to verify the identity of advertisers. It's not a bad idea, considering how many of them have turned out to be scammers.
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Stock images: Getty, unless otherwise stated.
