US senators call for probe of scam ads on Facebook and Instagram
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The senators expressed scepticism about Meta’s efforts to combat illicit advertising.
PHOTO: REUTERS
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WASHINGTON - US senators Josh Hawley and Richard Blumenthal have asked the heads of the Federal Trade Commission (FTC) and the Securities and Exchange Commission (SEC) to probe Meta Platforms, following a Reuters report about the social media giant’s revenue from ads on Facebook and Instagram that promote scams and banned goods.
“The FTC and SEC should immediately open investigations and, if the reporting is accurate, pursue vigorous enforcement action where appropriate” to force Meta to disgorge profits, pay penalties and agree to cease running such advertisements, Mr Hawley and Mr Blumenthal wrote in a letter to the federal agencies.
Earlier in November, Reuters reported that internal documents from late 2024 stated that it would earn about 10 per cent of its overall annual revenue – about US$16 billion (S$20.88 billion) – from running advertising for scams and banned goods.
One document noted Meta earns US$3.5 billion in revenue from “higher risk” scam ads every six months.
Other documents stated that Meta’s anti-fraud rules didn’t appear to apply to many ads that regulators and the company’s own staff believed “violated the spirit” of its rules against scam advertising.
In response to the Reuters report, Meta said it had reduced user reports of scams by 58 per cent over the last eighteen months.
The Hawley-Blumenthal letter “makes claims that are exaggerated and wrong,” Meta spokesman Andy Stone said.
“We aggressively fight fraud and scams because people on our platforms don’t want this content, legitimate advertisers don’t want it and we don’t want it either.”
Mr Hawley, a Republican from Missouri, and Mr Blumenthal, a Democrat from Connecticut, expressed scepticism about Meta’s efforts to combat illicit advertising.
They pointed to the company’s “ad library,” a publicly accessible database of advertising that appears on Meta’s social-media platforms.
“Even a short review of Meta’s Ad Library at the time of this letter shows clearly identifiable advertisements for illicit gambling, payment scams, crypto scams, AI deepfake sex services, and fake offers of federal benefits,” they wrote.
The senators cited Reuters reporting that Meta itself estimated its platforms were involved in a third of all scams in the US, and went on to note that the FTC estimates Americans lost US$158.3 billion to scams in 2024.
“This would suggest Meta was responsible for more than US$50 billion in consumer loss,” they wrote.
Their letter alleges that Meta has consciously chosen to accept ads that promote fraudulent activities.
“Scams have been allowed to take over Facebook and Instagram as Meta has drastically cut its safety staff, including for FTC mandated reviews, even as it dumps unimaginable sums into its generative AI projects.”
Mr Blumenthal and Mr Hawley expressed particular concern about fake ads purporting to represent the US government or political figures.
They cited an example of a bogus ad that claimed US President Donald Trump was offering US$1,000 to recipients of food assistance.
“While Meta has been warned about advertisement deepfakes impersonating politicians, it still continues to run fraudulent clips,” their letter states.
“The beneficiaries of these scams are often cybercrime groups based in China, Sri Lanka, Vietnam and the Philippines.” REUTERS
