An Australian regulatory body has imposed a fine of A$610,500 ($386,000) on the social media platform owned by Elon Musk for non-compliance with an investigation into its efforts to combat child abuse. This penalty comes as a setback for the company, which has faced challenges in retaining advertisers due to concerns about its lenient approach to content moderation.

The e-Safety Commission imposed a fine on X, the platform that Musk recently rebranded from Twitter. The X platform was found to be in violation as it did not adequately address inquiries regarding its response time to reports of child abuse material and the techniques it employed for detecting such content.

While the fine may seem relatively insignificant in comparison to the $44 billion Musk spent to acquire the website in October 2022, it does pose a challenge to the company’s reputation. This is especially concerning considering that the company has been experiencing a decline in revenue due to reduced advertising spending. This decline is largely attributed to the platform’s decision to minimize content moderation and reinstate thousands of previously banned accounts.

The EU is currently conducting an investigation into X due to concerns that the platform may have violated the new tech regulations by not effectively addressing disinformation related to Hamas’s attack on Israel.

Commissioner Julie Inman Grant highlighted the importance of effectively addressing illegal content on a large and global scale. She emphasized that having the necessary solutions, resources, and focus on combating this issue makes it straightforward to take a stand and make a difference.

“The only reason I can see to fail to answer important questions about illegal content and conduct happening on platforms would be if you don’t have answers,”

Inman Grant, former public policy director for [Twitter] until 2016

X decided to shut down its operations in Australia following Musk’s acquisition, resulting in the absence of a local representative available, and there was no immediate reply from the company’s media email address in San Francisco.

Under the new regulations implemented in 2021 in Australia, internet companies can be legally obligated to disclose details about their online safety measures or else face monetary penalties. In the event that a company fails to comply with the fine, the regulatory authority has the authority to initiate legal action against them in a court of law, as stated by Grant.

Following the company’s transition to private ownership, Musk emphasized in a statement that “eliminating child exploitation is our top priority.” However, the Australian regulatory body raised concerns when it inquired about X’s efforts to prevent child grooming on the platform, to which X replied that it is not extensively utilized by a significant number of young individuals.

X informed the regulatory authority that the current anti-grooming technology available for deployment on Twitter is lacking in capability and accuracy.

According to Inman Grant, the commission also provided a cautionary notice to Google, as they failed to comply with the commission’s request for information regarding their management of child abuse content. The commission criticized Google’s responses to certain inquiries as being too vague and generic. In response, Google expressed their disappointment with the warning and stated that they had cooperated with the regulatory body.

“We remain committed to these efforts and collaborating constructively and in good faith with the e-Safety Commissioner, government and industry on the shared goal of keeping Australians safer online,” expressed Lucinda Longcroft, Google’s representative for government affairs and public policy in Australia.

X’s lack of adherence to regulations was deemed more severe by the regulatory body. The concerns raised revolve around X’s failure to provide answers regarding response times to reports of child abuse, measures taken to identify instances of child abuse in livestreams, and the staffing levels dedicated to content moderation, safety, and public policy.

The company has informed the regulatory authority that it reduced its global workforce by 80% and no longer maintains any public policy staff in Australia since Musk took over. Furthermore, X also informed the regulatory body that its active monitoring for instances of child abuse material has decreased following Musk’s decision to privatize the company.

X has stated that it has refrained from employing tools to identify the content in private messages due to the technology is still under development.