Australia to bring anti-scam law targeting internet giants

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  • Posted by: Evans Asare
Australia to bring anti-scam law targeting internet giants

Australia to bring anti-scam law targeting internet giants this year, regulator says. Australia plans to introduce a law by the end of the year forcing internet companies to proactively stop hosting scams or face hefty fines, the top consumer regulator said on Friday, potentially setting up another showdown with Big Tech.

The Australian Competition and Consumer Commission (ACCC) and the Treasury Department are consulting internet, banking, and telecommunications firms about creating a mandatory, enforceable anti-scam code that legally requires them to take reasonable steps to protect users, including offering an effective complaint service.

In Australia, cryptocurrency scam advertisements featuring the face of mining billionaire Andrew Forrest have led to Australians losing millions of dollars, according to Forrest. He is suing Facebook owner Meta(META.O), over the advertisements in California after saying he was unable to force Meta to take action domestically.

Currently, only telecommunications providers face specific anti-scam regulation in Australia, according to the government. However, from 2020 to 2023, Australians’ losses from scams tripled to A$2.7 billion ($1.8 billion), consistent with global trends as the pandemic led to a significant increase in online activity.

That prompted the ACCC to push for new laws making all participating industries accountable. Putting legal liability on internet platforms may create a new point of conflict between Australia and an industry that has typically leaned on U.S. laws, which largely exempt them from responsibility.

The ACCC’s new regulation requiring internet companies to pay media companies licensing fees for content links has already prompted Meta to consider blocking media content on Facebook in Australia.

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“We are hoping to see them being rolled out in the course of this period to the end of this year,” ACCC Chair Gina Cass-Gottlieb said by phone, referring to mandatory anti-scam codes applying to each industry.

“We do need, we think, very clear and specific enforceable legal obligations.”

Failure to comply with the codes would subject companies to fines of A$50 million, three times the benefit gained by wrongdoing or 30% of turnover at the time it took place, the treasury department has said.

The ACCC is separately suing Meta for what it says is a failure to stop the publication of advertisements for cryptocurrency scams featuring faces of prominent Australians, including Forrest.

Meta is defending the case the ACCC filed in March 2022 and which is still at a pre-trial stage. Cass-Gottlieb said a mandatory code would reduce the need for “backward-looking” and time-consuming court enforcement that involved investigation, preparation and resolution of a lawsuit, plus appeals.

Meta declined to comment on the anti-scam code’s timing. The company said in a submission in January it wanted a voluntary code and the planned mandatory code might result in companies prioritising compliance over innovation.

Author: Evans Asare

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