Facebook is suing two Chinese nationals and a Hong Kong-based advertising agency for allegedly using the platform to deceive internet users into installing malware, allowing them to compromise “hundreds of thousands” of social media accounts to run ads for counterfeit goods.

Why it matters: The lawsuit is not the first the social media giant has filed this year against a Hong Kong company.

  • In August, Facebook sued an app developer in the city for implanting malware into Android apps that created fake clicks on the social network’s ads for financial gain.
  • Meanwhile, the company has been attempting to repair its battered reputation following the privacy issues that arose from the Cambridge Analytica scandal.

Details: Facebook has filed the lawsuit against ILikeAd Media International Company Ltd., as well as Chinese nationals Chen Xiaocong and Huang Tao for creating and distributing the malware.

  • Facebook said ILikeAd used images of celebrities in their ads to entice people to click on them, a practice known as “celeb bait.”
  • The social media giant also alleges that the defendants made use of a practice known as cloaking, which disguises an ad’s destination link in order to get around the company’s ad review protocols.
  • Facebook said the campaign began as early as 2016 and continued to August 2019.
  • The company said that since April it has been notifying “hundreds of thousands” of users that their accounts may have been compromised.
  • Facebook is seeking an injunction to stop ILikeAd from abusing its platform, as well as damages.

“Cloaking schemes are often sophisticated and well organized, making the individuals and organizations behind them difficult to identify and hold accountable. As a result, there have not been many legal actions of this kind.”

—Facebook in a statement

Context: In August, Facebook sued Hong Kong-based app developer LionMobi for “click injection fraud,” allowing the company to profit from fake clicks on ads displayed on a smartphone.

  • Facebook’s complaint was also lodged against Singapore-based developer JediMobi.
  • Both companies were banned from Facebook’s Audience Network, which allows advertisers to extend their campaigns across the internet and into apps.

Christopher Udemans is TechNode's former Shanghai-based data and graphics reporter. He covered Chinese artificial intelligence, mobility, cleantech, and cybersecurity.

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