Meta and Shopify urged to act on rise of ‘ghost stores’ targeting Australian online shoppers

In Australia, many consumers have fallen victim to online « ghost stores, » fraudulent sites posing as local businesses. These stores offer poor-quality or nonexistent products and make refunds nearly impossible. As complaints mount, experts are demanding that Shopify and Meta take responsibility for this situation, particularly given their role in sponsoring these sites’ false advertising. Fraud on the Rise in Australia « Ghost stores » are an increasingly common phenomenon in Australia, where more than 140 have been identified. These online businesses pretend to be local brands, often with a fictitious story about the store’s imminent closure and the need to clear inventory at low prices. Consumers, lured by these tempting offers, often end up with poor-quality products or nothing at all. Consumers Left Without Recourse Many people deceived by these « ghost stores » find themselves in a difficult situation. When the products arrive, they are of « deplorable » quality, and obtaining a refund is a real challenge. The return address provided is often located abroad, particularly in Zhejiang, China, making the process even more complicated.

The Responsibility of Digital Platforms

The rise of « ghost stores » has been facilitated by platforms like Shopify and Meta (via Instagram and Facebook), which allow these sites to use their services to reach consumers. These platforms have been criticized for their lack of vigilance and inaction in the face of the rise of digital fraud. The fact that these companies make money from paid advertising on these sites increases the pressure to act.

The Platforms’ Inaction in the Face of Fraud Reports

Despite multiple reports on social media, ads for these fraudulent sites continue to appear. **Meta, for example, reportedly ignored ads for at least thirteen of these companies despite receiving reports of fraud. Meta’s response mentions that a combination of technology and human review is used to process reports, but this approach clearly shows its limitations.**Experts Call for Concrete Measures

Erin Turner of the Consumer Policy Research Centre calls for collective action from digital platforms and regulators to stop these malicious actors. She describes this situation as a true « digital retail fraud, » emphasizing that without concerted action, these fraudsters will continue to circumvent the system.

The Psychological Impact on Victims For consumers, in addition to the financial loss, there is a significant emotional and psychological impact. A 60-year-old Brisbane woman described the frustration and anxiety caused by the scam, so much so that after several months of unsuccessful attempts, she abandoned her claim for a refund to protect her mental health.