Financial scammers who lure victims on Facebook will now find it more difficult. And it’s about time.
Meta is at long last cracking down on financial scams. Something they should have done years ago but which has taken pressure from the Government, the ACCC, media and the public to force action.
As you know, fake images and comments supposedly from me, have been used by these scammers to rip off unsuspecting Australians of millions of dollars. Meta has claimed there was nothing they could do about it. Now, miraculously they can.
Good riddance online crims
One of the world’s biggest and richest technology companies has always been able to crack down on these scams but, I suspect, the lure of huge advertising dollars from the scammers meant the financial rewards outweighed their responsibilities to the victims of these scammers.
In February, Meta (the owner of Facebook and Instagram) will require financial services advertisers to verify they are a legitimate business and be appropriately licensed by Australian regulatory authorities.
Yes, it’s that simple. A stupidly obvious change which, as I say, should have been done years ago. To the end of September, there were $135m in reported losses from investment scams in 2024 in Australia, according to the National Anti-Scam Centre, with $35m coming from social media scams.
Only legit money advisers
Financial services advertisers will be required to provide their Australian financial services licence number or declare an exemption. Individuals will need to provide a government-issued ID. The licence number will be authenticated by the Australian Securities Investment Commission.
It will apply to advertisers worldwide targeting Australian users on Meta’s platforms. The advertisers will also need to verify the business by uploading business documents. The person doing this will need to verify they work for the business, such as by supplying a work email address.
And, similar to political ads on Facebook, financial ads will require a disclaimer that allows users to see information about who is behind them.
Scammers are sneaky
Recently I was contacted by an elderly woman who had lost $100,000 clicking on a scam ad, illegally featuring my image and fake comments, which appeared on her Bible app which she read every morning. The combination of my image in the trusted environment of a Bible app gave the scam credibility in the eyes of this victim.
Another man recently lost $250,000 to a scam ad which appeared on a sports media platform.
Not only do these ads pop up on social media feeds and big platforms like Google and Facebook, but they now appear on legitimate news platforms as part of the programmatic advertising feeds at the bottom of news stories. You know those weird advertisements you see when you scroll down past the end of a story? That’s them.
Those advertisements and odd stories are provided by about four global tech companies who specialise in taking advertisements and distributing them globally. The legitimate news platform has no control over what appears on the feed, but they are paid for any reader traffic they generate.
The ones I’ve contacted to warn them of the scam ads using me simply say they have “no control over the content”. But they still take the money.
Not good enough.
New media needs rules
Traditional media – television, radio and newspapers – are legally responsible for the advertising they carry. They can be prosecuted for any illegal or deceptive advertising.
Why can’t digital platforms carry the same responsibility? They are the ‘new media’ but play under very different rules.
Digital platforms would certainly take the issue more seriously if they had to pay compensation to victims of cyber scam ads carried by their platforms. Or, as big global tech platforms seem to pay so little tax in Australia, why not impose a levy on their Australian revenue which would then go into a compensation fund for the victims?
Anyone can be scammed
Also, don’t think it’s just grandma and grandpa being ripped off by these scams. It is right across the community.
According to recent Australian Tax Office (ATO) data, younger Australians have fallen victim to the most tax scams. People aged 25 to 34 reported the most amount of money lost to tax scams, closely followed by those aged 18 to 24. In contrast, those aged 55 and above were among those who reported the least financial losses to the ATO.
The problem is the scams are becoming more sophisticated and “real”. Gone are the days of scams which were full of typos, bad grammar, and promises of riches from foreign royalty. The ATO are seeing many more sophisticated scam messages using official language and fraudulent websites that mimic online services.
The changes this week, which include cracking down on text message scams, are a step in the right direction.
There is always a gap between advances in technology and government regulation. But that gap needs to get smaller.
