Social media platforms are “tone deaf” to the damage done by allowing scam advertising in Australia, according to billionaire Andrew (Twiggy) Forrest.
Tattarang, Forrest’s family investment company, has made a submission to the Joint Select Committee on Social Media and Australian Society.
The inquiry submission takes aim at Meta and advertising that uses images of prominent people such as Forrest to drive engagement.
Others whose images have been misused include David Koch, Dick Smith, Gina Rinehart, Richard Wilkins, Karl Stefanovic, Maggie Beer, Sam Kerr and prime minister Anthony Albanese.
“Since March 2019 Dr Forrest has been the subject of thousands of misleading, fake, fraudulent and Al empowered scam advertisements on Meta's social media platforms Facebook and lnstagram,” said Tattarang.
“Despite giving immediate notice of the scam ads and having a direct dialogue with Meta's most senior Australian executives who promised to work to eliminate them, the Scam Ads continue to be displayed today, five years later.”
The submission said Meta's algorithms had been roaming out of control finding vulnerable Australians who had then lost life savings, and were reduced to poverty and welfare.
“The board and executives of Meta have taken no responsibility for the epidemic of fraud proliferating across their advertising platforms,” the submission said.
And taking legal action against companies based outside Australia is problematic.
The submission said foreign corporations such as Meta and X Corp deliberately adopt legal and operational structures that circumvent Australian jurisdiction.
“This was made starkly evident in the recent attempt by the eSafety Commissioner to obtain an injunction against X Corp,” the submission said.
“That case exposed a lacuna in the regulatory system that needs to be addressed. In other sectors of the economy which have the potential to pose serious systemic or other risks we require foreign corporations to submit to the Australian jurisdiction through licensing regimes and other mechanisms.
“For example, foreign banks must have local subsidiaries that hold Australian banking licences because the banking system is so critical to the economy and society.
“The pervasiveness and influence of social media platforms has elevated them to a similar level of significance, dictating the same approach should be taken to regulating them.”
Forrest is taking action in the US for harms done to him on the Australian Meta platforms.
He has started proceedings in the United States District Court, Northern District of California, San Jose Division against Meta Inc, a Delaware Corporation.
“Dr Forrest is fortunate that he can afford to take such proceedings,” the submission said.
“However, that is not an option for the thousands of Australian victims who have been defrauded by the scam sds.
“Moreover, despite years of litigation by Dr Forrest, Meta continues to flood its Australian platform with fraudulent ads featuring Dr Forrest's image.
“Nor is there any legitimate reason why Australian regulatory authorities seeking to enforce Australian laws against the platform owners' Australian operations must rely on voluntary compliance or go to US courts to enforce the judgments of Australian courts.”
The submission describes this as jurisdictional arbitrage, where a corporation seeks to avoid unfavourable law or judicial enforcement in a particular location and structures its entities and operations to circumvent potential liability, finding legal shelter elsewhere.
“The behaviour of Meta in Dr Forrest's case is a prime example of jurisdictional arbitrage which in this case involves locating, organising, and structuring the business functions of a corporation or lines of business in a foreign jurisdiction to avoid, reduce, or even eliminate legal obligations from operations that would ordinarily arise if they were present in or submitted to Australian jurisdiction.”
Meta, in its submission to the inquiry, says it has policies that prohibit scams and related behaviour and it has tools to allow people to block and report scams.
“We recognise that the Australian Government expects industry to do more to combat scams, especially those targeting Australians,” Meta said.
“To respond to this expectation, we have stepped up our efforts to ingest more intelligence signals, deploy greater risk-based verification measures and increase our awareness initiatives in Australia.”
Meta has had a dedicated channel for competition watchdog the ACCC to report scams content to the social media platform since September 2017.
“We review the content that is reported and take appropriate action if it is found to be violating,” Meta said.
“Since the establishment of the National Anti-Scams Centre (NASC) in July 2023, we have actively engaged with the various processes that it has established and worked towards increased industry collaboration to identify what more all of industry can be doing to combat scams.
“Beyond removing individual scam reports, we are working closely with the NASC to also identify scams trends and address these.
“In order to improve our detection, we make changes to our machine learning models by ingesting new scam trends and signals that we receive from users’ reports and government escalations.
“We are also building a system for evaluating and ensuring the precision of our machine learning. Over time, these changes allow us to improve our proactive detection and enforcement at scale.
“We are also currently exploring the development of tools by introducing new technology that would allow our system to detect better, faster and receptive to the newer scams trends.”
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