Belle Gibson launched a cookbook and smartphone app in 2013 following claims she overcame the disease through alternative therapies such as Ayurvedic medicine and with a diet free of gluten and refined sugar.
She admitted to an Australian magazine last year that she made up the diagnosis.
Consumer Affairs Victoria said it was taking legal action relating to “false claims by Ms Gibson and her company concerning her diagnosis with terminal brain cancer, her rejection of conventional cancer treatments in favour of natural remedies and the donation of proceeds to various charities”.
“The Whole Pantry” was a cookbook with 80 mostly plant-based recipes that drew inspiration from Gibson’s purported battle against cancer.
Gibson’s lie began unravelling when it emerged in March 2015 that she failed to donate Aus$300,000 (US$22,120) in profits from the sales of her cookbook to charity as promised and friends started to question her diagnosis via the media.
Gibson told the Australian Women’s Weekly the following month that after years of lies, confronting the truth was “very scary, to be honest”.
“No. None of it is true,” she confessed in the interview. “I just think (speaking out) was the responsible thing to do. Above anything else, I want people to say ‘okay, she’s human’.”
Penguin publishers stopped selling “The Whole Pantry” in 2014 after her lie was uncovered, and Consumer Affairs Victoria said the publisher would make a Aus$30,000 donation to the Victorian Consumer Law Fund.
Consumer Affairs Victoria said Friday it had applied to start proceedings in the Federal Court of Australia.