IMF Bentham eyes potential Facebook, Cambridge Analytica goldmine

IMF Bentham will potentially fund a class action against Facebook, having already invested in a complaint against the social media giant in response to the now-infamous Cambridge Analytica scandal.

IMF Bentham is funding a new representative complaint made to the Australian Information Commissioner against Facebook Australia, Facebook Ireland and Facebook Inc.

The complaint relates to alleged breaches of the Australian Privacy Principles - as per the Privacy Act 1988 - in that Facebook users' personal information was improperly shared with a third party.

In late March, Facebook became embroiled in multiple lawsuits when it was found to have exposed raw data on 50 million users to political consulting firm Cambridge Analytica.

Cambridge Analytica obtained user information with the help of University of Cambridge researcher Aleksandr Kogan, who created a Facebook quiz app that harvested data from quiz takers. Due to a vulnerability in Facebook's API, information about the quiz-takers' friends was also harvested.

The Australian Information Commissioner is already investigating the matter, though IMF Bentham highlighted that compensation for affected Facebook users may not result if the Commissioner opts to enforce a civil penalty against one or more of the entities named in the complaint.

As such, IMF Bentham has confirmed it will consider the viability of a class action on behalf of individuals that used a personal Facebook account between 2010 and March 2015. Only those that received and can supply a copy of a message from Facebook that their information was shared with Cambridge Analytica would be eligible to participate.

Earlier today, the Information Commissioner's Office in the UK handed Facebook a $900,000 (?500,000) fine for its part in the scandal - the maximum amount possible.

Facebook was fortunate in that the offences took place prior to the May 2018 introduction of the European General Data Protection penalties which caps fines at a much higher level; €20 million or 4% of global turnover. According to Statista, Facebook reported close to $55 billion in revenue for 2017.

In the wake of the scandal, fund managers and institutional investors reassessed where Facebook sat within their overall ESG strategies.

Most tellingly, BetaShares removed the platform from its $208 million Global Sustainability Leaders ETF, meaning that the likes of Future Super and Raiz Invest (then Acorns) no longer invest in Facebook.

Read more: FacebookCambridge AnalyticaIMF BenthamAustralian Information CommissionerFacebook AustraliaAcornsAleksandr KoganBetaSharesEuropean General Data Protection.Facebook IrelandFuture SuperGlobal Sustainability Leaders ETFRaiz InvestStatista
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