The Australian Competition and Consumer Commission (ACCC) has launched a landmark Federal Court lawsuit against Meta Platforms, Inc., the parent company of Facebook and Instagram. The regulator alleges the tech giant engaged in misleading conduct and failed to protect consumers, including children, from widespread scam advertisements and dangerous content.
Allegations of Systemic Failure
The ACCC's case centres on two primary accusations. First, it claims Meta did not take sufficient steps to prevent, detect, or remove scam advertisements featuring prominent Australian public figures from its platforms. These ads, which often promoted fraudulent investment schemes and cryptocurrency scams, have been a persistent problem, misleading countless users.
Second, the lawsuit alleges Meta's algorithms actively recommended harmful content to children under the age of 13. This content reportedly included material related to extreme dieting, eating disorders, self-harm, and potentially dangerous challenges. The ACCC argues Meta was aware of the significant number of underage users on its platforms but failed to implement adequate age-based protections.
The Details of the Legal Action
The legal proceedings were officially filed in the Federal Court on December 30, 2025. The ACCC is seeking declarations, injunctions, penalties, and costs. The case is being led by ACCC Chair Gina Cass-Gottlieb, who stated the action sends a clear message that digital platforms must prioritise consumer safety.
"We allege Meta's systems enabled scammers to target Australians with fake ads featuring well-known personalities," Cass-Gottlieb said. "Furthermore, we claim Meta's algorithms exposed young children to highly inappropriate and damaging material."
The lawsuit highlights specific failures, including inadequate ad review systems and the alleged amplification of harmful content through recommendation engines. The ACCC contends these practices violate Australian Consumer Law by engaging in conduct that is misleading or deceptive and unconscionable.
Potential Consequences and Industry Impact
This lawsuit represents one of the most significant legal challenges to Meta's operations in Australia. If successful, it could result in substantial financial penalties and force major changes to how the company moderates content and advertising on Facebook and Instagram.
The case also places a renewed spotlight on the broader issue of social media regulation and the duty of care owed by global platforms to their users, particularly vulnerable groups like children. It follows increased global scrutiny of how algorithms curate and promote content.
Consumer advocacy groups have largely welcomed the ACCC's move, viewing it as a necessary step to hold powerful tech companies accountable. The outcome of this case could set a crucial precedent for how Australian law governs online safety and advertising integrity in the digital age.
Meta is expected to vigorously defend against the allegations. The company has previously stated it invests significant resources in combating scams and enforcing policies designed to protect younger users. The Federal Court will now determine the validity of the ACCC's claims and what remedies, if any, are required.
