The Australian Competition and Consumer Commission (ACCC) will ask the Federal Court to impose hefty fines and orders for Meta allowing the ads, which showed people including David Koch and Dick Smith backing schemes they never endorsed. Victims lost at least $100 million.

ACCC chair Rod Sims said no other competition or consumer agency in the world had taken this sort of legal action.

"If we're successful, it means that platforms and in this case Facebook, have to do a lot more to protect and put in much more active steps to do that," he said.

"That would be a wonderful thing for Australians but hopefully have an effect worldwide so that people can use the internet, get all the massive benefits of it, without the disincentives."

The ACCC alleges Meta staff learned early on that the endorsements were fake and the ads were scams, but were slow to act.

Users who clicked the ads were shown what the ACCC alleges were fake media articles that included prominent Australians making comments endorsing money-making schemes.

Mining magnate Andrew Forrest and former NSW premier Mike Baird were others whose identities were used without permission.

Users were encouraged to register for the schemes. Scammers then repeatedly called those who registered and asked them to transfer money.

One person lost more than $650,000 through one of the scams, promoted as an investment opportunity.

Mr Sims said Meta was responsible for ads it published.

"Meta should have been doing more to detect and then remove false or misleading ads on Facebook, to prevent consumers from falling victim to ruthless scammers," he said.

A Meta spokesman said it co-operated with the ACCC investigation and would defend the action.

"We don't want to see ads seeking to scam people out of money or mislead people on Facebook," he said.

"They violate our policies and are not good for the community."

The spokesman said Meta used technology to detect and block scam ads.

The company could not comment on the detail of the ACCC action, he said.

Mr Sims argued Facebook's targeting technology exacerbated the problem by showing the scam ads to those most likely to click them.

He estimated the cost of the ACCC legal action would be more than $1 million.

Mr Forrest has been particularly strident in his criticism of the scams.

The Fortescue Metals boss published an open letter to Meta owner Mark Zuckerberg in 2019 calling for Facebook to stop accepting ads falsely using his name and face.

The mining magnate this year filed criminal charges against Meta.

People who think they may be the victim of a scam should contact their bank or financial provider.

Australian Associated Press