FACEBOOK management failed repeatedly to reveal the activity of an international child pornography syndicate operating on their site and ignored continuing admissions by one of the ring's Australian members.
The failure by the social networking site was uncovered during a federal police-led international investigation of the syndicate, which had been using fake online identities.
''We are aware that Facebook knew of the existence of these pages and even went so far as to remove the profiles,'' said the director of the AFP High Tech Crime Centre, Neil Gaughan.
But despite closing down the pages after finding illegal material, Facebook did not contact police, Mr Gaughan said.
"Facebook deactivated the online accounts of the initial suspects but there were indications that, within hours, the groups were re-forming again.''
The taskforce, codenamed Project Ocean, was set up by the AFP in March. By June it included the FBI in the US, the Child Exploitation Online Protection Centre in Britain, the Royal Canadian Mounted Police and police in Germany, South Africa and Switzerland.
While officers believe there may have been dozens of people involved in the ring, to date 11 men have been arrested. They include two Melbourne men, aged 33 and 18, and a 26-year-old from Port Kembla. The British-based man police say is the ringleader was due to face an English court overnight.
All 11 are accused of creating Facebook pages under false identities and using the pages to distribute and view graphic sexual images of children.
And in breaking news just in a convicted sex offender has been jailed for four years after he was found guilty yesterday of using Facebook to share more than 100,000 indecent images of children.
Ian Green, 45, from West Sussex, England, admitted 24 charges of making, possessing and distributing images of abused children.
He was discovered during an international investigation which began in Australia earlier this year and linked a number of Facebook accounts containing the child pornography to a user in the UK.
Fairfax Media revealed yesterday that Facebook management failed repeatedly to reveal the activity of the international child pornography syndicate operating on their site and even ignored admissions by one of the ring's Australian members.
The failure by the social networking site was uncovered during a federal police-led international investigation of the syndicate, which had been using fake online identities.
Chichester Crown Court heard that Green, one of the members of the ring, used 11 different Facebook accounts to distribute the images, along with indecent videos of children.
He also shared the photographs, 724 of which were rated at the most extreme level of "five", using email and MSN.
Green was arrested in May after investigators infiltrated the network and found that Green had enabled selected contacts to access the groups.
The contacts had to demonstrate they were trustworthy but adding their own images of children, then facilitating access to the next group.
The BBC reported overnight that the court was told that as each group added images, they became more extreme and later included video of abuse.
On April 29, the UK Child Exploitation and Online Protection Centre alerted Sussex Police to a Facebook user in the county and Green was arrested on May 10.
The court also heard that he was already on the sex offenders register and had been jailed in 2005 for 12 months for distributing indecent images of children.
Five further suspected offenders have been arrested in the UK, it has been reported.
After federal police arrested one of the Australians, he stunned them by describing how he had sent up to 10 messages to Facebook allegedly informing them about the ring, but the company failed to pass the information to police.
Federal police also contacted a Facebook official in Australia to convey their concerns, and were told he would relay their concerns ''to the boss''. But the AFP received no further reply.
Facebook has been criticised in the past for failing to address privacy and safety concerns held by its hundreds of millions of users.
The company does not have employees in Australia and the US headquarters could not be contacted for comment yesterday. However, a Sydney public relations company that works for the company sent the Herald quotes made by the company's chief security officer two months ago.
"Our policy of using real names, real people and verifiable email addresses is central to maintaining safety on Facebook - Facebook is not anonymous and neither is a criminal if he or she tries to use the service for illegal activity,'' Joe Sullivan said.
with Bree Fuller
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