Australia slaps Meta with $14m fine for secret data collection

Australia’s Federal Court has ruled that Meta Platforms, the owner of Facebook, must pay fines amounting to 20 million Australian dollars ($13.5 million) for engaging in undisclosed data collection through a smartphone application. The court’s decision came after the Australian Competition and Consumer Commission (ACCC) filed a civil lawsuit against Meta, accusing the tech giant of collecting user data without proper disclosure.

The fines imposed on Meta also include a payment of 400,000 Australian dollars ($270,631) in legal costs to the ACCC. The case revolved around the actions of Meta’s subsidiaries, Facebook Israel, and a now-defunct app called Onavo, which offered a virtual private network (VPN) service to users from early 2016 to late 2017. Onavo was marketed as a tool to protect users’ personal information and obscure their internet identity by providing a different online address.

However, the court found that Facebook had been using Onavo to clandestinely gather users’ location, activity frequency, and time spent on other smartphone apps and websites, all for its own advertising purposes. Justice Wendy Abraham, in her written judgment, pointed out that the lack of sufficient disclosures regarding data collection deprived thousands of Australian consumers of the opportunity to make informed choices about their data before downloading and using Onavo Protect.

The fine of 20 million Australian dollars is a significant penalty, considering that each breach of consumer law could have carried a fine of 1.1 million Australian dollars ($743,721). This amounts to a substantial number, considering that the Onavo app was downloaded approximately 271,220 times in Australia.

Meta’s revenue of $116 billion in the previous year makes the imposed fine a relatively minor financial setback for the company. In response to the court’s ruling, Meta released a statement claiming that the ACCC acknowledged they did not intentionally deceive customers and highlighted their efforts to enhance transparency and user control over data usage in recent years.

ACCC Chair Gina Cass-Gottlieb emphasized that Australian consumers deserve clear information about the handling of their data, enabling them to make informed decisions about its usage. While this ruling addresses one aspect of Meta’s legal troubles in Australia, the company still faces an ongoing civil court action initiated by Australia’s Office of the Information Commissioner over its involvement with data analytics firm Cambridge Analytica in the country.

This recent judgment serves as a reminder to tech companies about the importance of transparent data collection practices and reinforces the significance of user privacy in the digital age.