The Consumer Federation of America (FCA) has filed a lawsuit against Meta, accusing the company of misleading users regarding its efforts to combat fraudulent advertising on Facebook and Instagram. The lawsuit has been filed in Washington and concerns, among other things, advertisements for fake websites, including unlicensed online casinos. According to the plaintiffs, the company’s actions violate consumer protection laws.
Unlike the usual schemes, where fraudsters contact the victim directly, this case involves advertising. The FCA believes that Meta has profited from such adverts whilst allowing them to be widely distributed. The lawsuit cites examples of such adverts from Facebook’s Ad Library: promises of $1,400 payments, ‘free’ iPhones from the government, and other typical scams targeting specific groups of users.
Meta has rejected the allegations and stated that it will defend its position in court.
“These allegations misrepresent the reality of our work and we will fight them,” said company spokesperson Chris Sgro.
Ben Winters, Director of AI and Data Protection at the FCA, noted that it is not difficult to find questionable advertisements. According to him, even a simple search for terms such as ‘free phone’ or ‘government payment’ in Meta’s advertising database reveals numerous suspicious offers. It is also known that active adverts for “secret tax payments” have been found on Meta’s platforms, which led to websites promising to reveal “crisis-proof investment strategies”. Meta has not responded to the question of whether such adverts comply with its rules.
It is worth noting that the FCA is demanding not only compensation for damages but also the return of profits it considers unlawful, and is insisting on a change in the company’s approach to ad moderation. According to Winters, Meta needs to be more effective at blocking repeat offenders and preventing misleading adverts from appearing.
At the same time, Meta emphasises that the company is doing everything it can to combat fraud.
“We aggressively combat scams across our platforms to protect people and businesses. Last year alone, we removed over 159 million fraudulent ads, 92% of which we took down before anyone reported them, and took down 10.9 million accounts on Facebook and Instagram associated with criminal scam operations,” said Chris Sgro.
- Official information: Federation press release
- FCA lawsuit against Meta: Lawsuit
