Santa Clara County has become the latest entity to sue Meta over scam ads on Facebook and Instagram. The lawsuit, brought by County Counsel Tony LoPresti, alleges that the company has profited from “a vast ecosystem of scam ads” that have defrauded senior citizens and other vulnerable people.
The lawsuit references a report last year from Reuters that cited internal documents detailing the billions of dollars scam advertisers have poured into Meta’s platforms. Meta makes as much as $7 billion a year from such ads, the filing says. It also claims that Meta’s own processes and policies have enabled scams.
Santa Clara, which is just one county over from Meta’s Bay Area headquarters, says it’s the first such case brought by a local civil prosecutor. “While our region has certainly benefited from the tech boom, we can’t sit idly by when we know good and well that a tech giant is swindling the public to hit a revenue target,” LoPresti said during a press conference.
In a statement, a Meta spokesperson said the company would fight the lawsuit.”This claim relies on Reuters reporting that distorts our motives and ignores the full range of actions we take to combat scams every day,” the spokesperson said. “We aggressively fight scams on and off our platforms because they’re not good for us or the people and businesses that rely on our services. We removed over 159 million scam ads last year alone, launched new tools to protect people, and partnered with law enforcement around the globe to disrupt these criminals.”
Meta has faced continued scrutiny over its handling of scammy advertisers. On Tuesday, nonprofit watchdog group the Center for Countering Digital Hate (CCDH) published a report on Medicare-related scam ads on Facebook targeting seniors.
The group found that Meta has made more than $14 million from Medicare scams on Facebook, many of which were repeat offenders who had numerous ads removed by the company in the past. The scams used many tactics employed in other types of fraudulent ads, including fake AI-generated celebrity endorsements.
“Scammers are determined criminals who use increasingly sophisticated tactics to defraud people and evade detection on our platforms and across the internet,” Meta said in a statement. “We aggressively fight scams on and off our platforms because they’re not good for us or the people and businesses that rely on our services.”
Meta last month was also sued by the nonprofit Consumer Federation of America (CFA), which filed a proposed class action lawsuit in Washington D.C claiming the company has broken consumer protection laws in its handling of scam advertisements on the platform. The lawsuit cited ads promoting “free” iPhones and $1,400 checks.
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