Facebook Scams Demand Stricter Online Rules, Japan Lawmaker Says

(Bloomberg) -- Japan must implement laws to better regulate companies like Meta Platforms Inc. when they fail to address social media scams, the head of the ruling party’s digital promotion working group said.

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The country’s lawmakers are demanding a swifter response from Meta’s local unit, as a growing number of online ads featuring celebrity images attempt to swindle people out of their money, former Digital Transformation Minister Takuya Hirai said in an interview. Under consideration is a proposal to summon Meta Chief Executive Officer Mark Zuckerberg to testify before the Diet, he said.

Facebook is home to a disproportionate number of fake ads in Japan, Hirai said. The company’s efforts to rectify the situation are far from enough and the situation is unacceptable, he said. “Meta is the most non-compliant platform owner.”

The 66-year-old lawmaker said his team will work closely with the Liberal Democratic Party and government officials to step up monitoring of big US tech companies’ operations in Japan and will map out detailed policy options by the end of the current parliament session in June. Hirai also suggested Meta should suspend all Facebook ads until the platform operator finds a better way to combat fraud.

The growing number of scams has triggered a backlash in a country with a gross savings rate of nearly 30%. Particularly vocal condemnation has come from entrepreneurs Yusaku Maezawa and Takafumi Horie, whose images have often been manipulated by the fraudsters. The two have accused Meta of negligence and have called for stricter regulations.

Earlier this week, four victims sued Meta Japan for damages totaling ¥23 million ($150,000).

The Menlo Park, California, company said it’s deployed both staff and artificial intelligence software to detect and delete inappropriate ads on its service. A Meta Japan representative did not respond to a request for comment.

Regulators across the globe are seeking to rein in big firms that are controlling a growing number of key technologies. Japan’s Fair Trade Commission took its first antitrust action against Google parent Alphabet Inc. for limiting a rival’s ability to compete, while Prime Minister Fumio Kishida approved a legislative bill on Friday that would fine big tech firms for unfairly using their influence to block competitors’ smartphone app business.

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