Australia slaps Meta with $14 million fine for illegally collecting user data, not disclosing it

Meta has been slapped with a fine of $14 million dollars for using a VPN to illegally collect user data to target them with ads, all without disclosing the data collection part of the app

A court in Australia has ruled that Meta Platforms, the owner of Facebook, must pay fines totalling 20 million Australian dollars ($13.5m). The fines were imposed because Meta collected user data through a smartphone application called Onavo without disclosing this action to its users.

The court also ordered Meta, along with its subsidiaries Facebook Israel and the now-defunct Onavo app, to pay 400,000 Australian dollars ($270,631) in legal costs to the Australian Competition and Consumer Commission (ACCC), which brought the civil lawsuit against Meta.

This legal issue is related to Meta’s handling of user information since the scandal involving data analytics firm Cambridge Analytica during the 2016 United States election. However, another civil court action against Meta by Australia’s Office of the Information Commissioner regarding its dealings with Cambridge Analytica in Australia is still ongoing.

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The court’s judgment pertained to Onavo, a virtual private network (VPN) service that Facebook offered between early 2016 and late 2017, promoting it as a tool to protect personal information.

In reality, Facebook used Onavo to collect users’ location, time, and website visit frequency to bolster its advertising efforts.

“The failure to make sufficient disclosures … may have deprived tens of thousands of Australian consumers of the opportunity to make an informed choice about the collection and use of their data before downloading and/or using Onavo Protect,” Abraham wrote.

The potential fine for Meta’s actions could have been significantly higher, probably running into the billions, considering the number of app downloads and breaches of consumer law. The court could have fined Meta hundreds of billions of dollars since Australians downloaded the app 271,220 times and each breach of consumer law carried a fine of 1.1 million Australian dollars ($743,721).

However, the court viewed the contraventions as a single course of conduct and settled on the agreed-upon penalty, ensuring that it carries enough weight to discourage such behaviour as a mere cost of doing business.

In response to the ruling, Meta claimed that the ACCC acknowledged it never aimed to deceive customers and highlighted its efforts to provide greater transparency and control over data usage in recent years.

The ACCC Chair, Gina Cass-Gottlieb, emphasized that Australian consumers should have access to clear information and be able to make informed choices regarding their data.