Monday, January 14, 2013

Norway's Consumer Ombudsman: Facebook Generally Agrees it Has a Counterfeit Goods Advertising Problem

According to Norway's Consumer Ombudsman, Facebook has a problem with counterfeit goods and scamming schemes being advertised on its platform.  On November 6, 2012, Norway's Consumer Ombudsman held a meeting with Facebook's representatives and the topic of discussion was misleading advertising for counterfeit goods and scamming sites on its website.

Norway's Consumer Ombudsman's position appears to be that Facebook allows onto its website a significant number of ads for web shops and scamming schemes that are in violation of the Norwegian Marketing Control Act (MCA).  These finding are very troubling and may indicate that Facebook may need to spend significantly more to comply with Norway's Marketing Control Act. 

How much more will Facebook need to spend to comply with Norway's law will depend on the depth of problem.  However, it appears that Facebook's screening process may also fall short here in the United States.  I have personally reviewed hundreds of suspected ads for counterfeit merchandise on Facebook so I believe this may be a much larger challenge than many realize.

Does Facebook have a Google pharma ad problem on its hand?  In 2011, Google agreed to pay a $500 million dollar fine to avoid prosecution due to displaying advertisements from Canadian pharmacies which illegally sold prescription drugs to American consumers.  An important question in the Google case was did it intentionally turn a blind eye to the matter?  Is Facebook intentionally turning a blind eye regarding advertising for counterfeit merchandise on its platform?

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