Meta earned more than $3 billion from fraudulent advertising by Chinese advertisers

On the 15th of December, Reuters published a report about Meta, which according to the company’s internal data, earned more than $3 billion from fraudulent ads placed by Chinese advertisers on its platforms.

Despite the ban on the use of Meta platforms within China, Chinese companies continue to actively advertise on Facebook and Instagram focusing on foreign audiences. In 2024, such advertising brought Meta more than $18 billion, which is over 10% of the company’s total revenue. At the same time, Meta’s internal estimates show that about 19% of this revenue came from advertising fraudulent schemes, unlicensed gambling, fake goods, and other prohibited content.

According to Meta’s internal data, China became the source of about a quarter of all fraudulent and prohibited ads on the company’s platforms worldwide. Victims included users in the United States, Canada, Taiwan, and other countries who lost money on fake investments, goods, and services.

In the second half of 2024, Meta created a special team to combat advertising fraud from China and was able to reduce the share of problematic ads by almost half. However, following a strategic review involving Mark Zuckerberg, the team’s work was suspended, some restrictions were relaxed, and several new measures were cancelled due to concerns about the negative impact on revenue.

As a result, by 2025, the proportion of prohibited advertising had once again increased significantly. Internal documents indicate that Meta had effectively decided to tolerate the increased level of violations, considering the Chinese market to be ‘special.’

A separate study commissioned by Meta from London-based consulting firm Propellerfish concluded that the company’s business model itself encourages fraud: advertising is placed via a complex network of intermediaries, advertiser checks are minimal, and Chinese authorities do not intervene because the violations are aimed at foreign audiences.

According to Meta, the company is actively fighting fraud, removing millions of ads and blocking more than 46 million ads sent through its Chinese business partners over the past 18 months, most often before users even saw them.

However, the investigation has increased pressure from regulators and raised the question of choosing between user safety and maintaining revenue growth.