Facebook has breached 22 different privacy laws in Canada, according to privacy group the Canadian Internet Policy and Public Interest Clinic.
The group has filed a complaint against Facebook with the Office of the Canadian Privacy Commissioner, Jennifer Stoddart, accusing the social networking site of collecting sensitive information about its users and sharing it without their permission or alerting them as to how the data is used. Facebook rejects the claims.Click here for Computex 2008 breaking news
Clinic director Phillipa Lawson told BBC News: "Facebook needs to be held publicly accountable".
"It (social networking) is proving to be a tremendous tool for community-building and social change, but at the same time, a minefield of privacy invasion," explained Lawson.
"We chose to focus on Facebook because it is the most popular social networking site in Canada and because it appeals to young teens who may not appreciate the risks involved in exposing their personal details online," she added.
The violations of the Canadian Personal Information Protection and Electronic Documents Act (Pipeda) were discovered after four law students at the clinic analysed the company's policies and practices as part of a course.
In response Facebook issued a statement: "We pride ourselves on the industry leading controls we offer users over their private information. We believe that this is an important reason that nearly 40 percent of Canadians on the internet use our service.
"We've reviewed the complaint and found it has serious factual errors, most notably its neglect of the fact that almost all Facebook data is willingly shared by users."
Harley Finkelstein, a student behind the complaint, told the BBC: "If you add a third-party application offered on Facebook, you have no choice but to let the application developer access all your information even if they don't need it."
The Canadian Privacy Commissioner has a year to act on the complaint. If she fails to resolve the issue she can seek a court injunction against the social networking site.
Facebook added: "We look forward to working with Commissioner Stoddart to set the record straight and will continue our ongoing efforts to educate users and the public around privacy controls on Facebook, including a brochure and video project we have completed with Ontario information and privacy commissioner Ann Cavoukian."
See also: Facebook photos are a privacy threat