Meta accused of earning 10% of revenue from known scams
U.S. Senators Josh Hawley and Richard Blumenthal have called for a federal investigation into Meta regarding alleged profits from scam advertisements on Facebook and Instagram, following a Reuters report detailing internal company documents.
The call for an investigation stems from a Reuters article that, citing internal Meta documents, claimed nearly 10% of Meta’s 2024 revenue, approximately $16 billion, originated from “illicit advertising.” One document reportedly indicated that Meta earned $3.5 billion in six months from “higher-risk” scam ads. These internal records allegedly suggested that ads violating fraud rules were permitted to run because they did not apply to many ads that staff believed “violated the spirit” of anti-scam rules. Meta denies these allegations.
In a letter to the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC), the senators urged regulators to initiate investigations and, if the reporting is accurate, pursue enforcement actions requiring Meta to “disgorge profits, pay penalties and agree to cease running such advertisements.”
The senators further allege that Meta’s platforms may be implicated in “about a third of all US scams,” contributing to over $50 billion in consumer losses last year. They argue that Meta’s reporting of a 58% reduction in scam ad reports over 18 months does not fully reflect broader trends.
Meta spokesman Andy Stone responded to these allegations, stating they are “exaggerated and wrong.” Stone asserted that the company “aggressively fights fraud and scams” because users, legitimate advertisers, and Meta itself do not want such content on its platforms.
Concerns raised by the senators include specific examples of scam ads impersonating government figures, such as a fraudulent advertisement falsely claiming President Donald Trump was offering $1,000 to food assistance recipients. The senators also pointed to potential involvement of foreign cybercrime groups based in countries like China, Sri Lanka, Vietnam, and the Philippines in these scam campaigns.
The lawmakers describe Meta’s lax enforcement, coupled with the presence of gambling ads, payment scams, political deepfakes, and other potentially dangerous content in its public Ad Library, as posing significant risks.
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