Aussie litigation fund threatens action over alleged Facebook privacy breach

Litigation funder IMF Bentham is preparing to potentially sue social media giant Facebook in Australia over its sharing of users' data with political consultancy Cambridge Analytica.

The world's largest social network said in April that data of up to 87 million people ended up in the hands of Cambridge Analytica, which was employed by Donald Trump's 2016 U.S. presidential campaign.

In Australia, more than 311,000 users data may have been used without authorisation, Facebook said in April, when Australia's Information Commissioner, the country's privacy regulator, began to investigate.

IMF said it has complained to the Australian Information Commissioner alleging breaches of privacy laws over the data sharing.

A class action lawsuit seeking compensation for users could follow depending on the regulator's response, IMF said.

Meanwhile, a Facebook spokeswoman did not comment directly on IMF's statement but said the company was "fully co-operating with the investigation currently underway by the Australian Privacy Commissioner," using the former name of the Information Commissioner.

The London-based consultancy Cambridge Analytica filed for bankruptcy in May and was unavailable for comment - it said previously that it deleted the data and did not use it in Trump's campaign.

Facebook has faced widespread criticism from users and scrutiny around the world from regulators and lawmakers since news broke that users' data had been shared. It has also been sued.

Nathan Landis, an investment manager at IMF Bentham, said the firm already had a prime litigant, a Sydney man who did not want to be identified.

"There's just not that much precedent, certainly not for the sort of scale that we're talking about here," he said, referring to the potential number of litigants.

The information commissioner closes most investigations in a year, so IMF said it may be some time before it decides whether to pursue a lawsuit or not - with Landis adding it may wait for regulatory investigations in the European Union and Britain to conclude before making a move.

“The alleged breaches surround the circumstances in which a third party, Cambridge Analytica, gained unauthorised access to users’ profiles and information,” a company statement from IMF Bentham added.

“The complaint seeks financial recompense for the unauthorised access to, and use of, their personal data.”

Furthermore, the company also invited users to join the class action through a dedicated website, aimed at those who held a Facebook account in Australia from 2010 to March 2015.

“Australians are some of the most prolific social media users in the world,” a company statement added. “Independent reports suggest up to 60 per cent of Australia’s population are Facebook users. Australia was the 10th hardest hit by the breach globally.

“Australia’s Privacy legislation requires companies holding personal information to take reasonable steps to ensure that personal information is held securely and that customers are adequately notified about the collection and handling of their personal information.”

(Reporting by Tom Westbrook and Byron Kaye in Sydney. Additional reporting by Ambar Warrick in Bengaluru; Editing by Himani Sarkar and Neil Fullick)