Disgraced blogger Belle Gibson will be pursued by Victoria's consumer watchdog over her claims that she beat terminal cancer through healthy food and natural therapies.

Consumer Affairs Victoria was on Tuesday given the green light to take Federal Court action against Ms Gibson and her company - which is in liquidation - for false and misleading conduct.

Ms Gibson could face substantial financial penalties, with $220,000 the upper limit for individuals, and companies liable for fines of up to $1.1 million.

Ms Gibson has been accused of failing to donate $300,000 from the sales of her wellness app, The Whole Pantry, to charity. Penguin Australia Pty Ltd had earlier withdrawn Ms Gibson's book from sale after admitting it had not substantiated her claims about curing her alleged cancer without medication. Ms Gibson's app was also withdrawn by Apple.