Meta earns billions from ads for scams, report claims
Around 10 per cent of the Facebook owner’s revenue reportedly came from fraudulent ads last year
Meta earns billions of dollars every year from running online advertising for scams and banned goods across Facebook, Instagram and other platforms, new documents have revealed.
The tech giant internally projected late last year that it would earn about 10 per cent of its overall annual revenue – or $16 billion – through fraudulent e-commerce and investment schemes, illegal online casinos, and the sale of banned medical products, Reuters reported.
The cache of previously unreported internal documents also showed that the social-media giant for at least three years failed to identify and stop an avalanche of ads that exposed Facebook, Instagram and WhatsApp’s billions of users to scams and illegal products.
On average, one December 2024 document notes, the company shows its platforms’ users an estimated 15 billion “higher risk” scam advertisements – those that show clear signs of being fraudulent – every day. Meta earns about $7 billion in annualized revenue from this category of scam ads each year, another late 2024 document states.
Much of the fraud came from marketers acting suspiciously enough to be flagged by Meta’s internal warning systems. But the company only bans advertisers if its automated systems predict the marketers are at least 95 per cent certain to be committing fraud, the documents show.
If the company is less certain – but still believes the advertiser is a likely scammer – Meta charges higher ad rates as a penalty, according to the documents. The idea is to dissuade suspect advertisers from placing ads.
The documents further note that users who click on scam ads are likely to see more of them because of Meta’s ad-personalization system, which tries to deliver ads based on a user’s interests.
The details of Meta’s confidential self-appraisal are drawn from documents created between 2021 and this year across Meta’s finance, lobbying, engineering and safety divisions. Together, they reflect Meta’s efforts to quantify the scale of abuse on its platforms – and the company’s hesitancy to crack down in ways that could harm its business interests.
Meta’s acceptance of revenue from sources it suspects are committing fraud highlights the lack of regulatory oversight of the advertising industry, said Sandeep Abraham, a fraud examiner and former Meta safety investigator who now runs a consultancy called Risky Business Solutions.
“If regulators wouldn’t tolerate banks profiting from fraud, they shouldn’t tolerate it in tech,” he told Reuters.
A spokesperson for Meta said the documents “present a selective view that distorts Meta’s approach to fraud and scams.”
The company’s internal estimate that it would earn 10.1 per cent of its 2024 revenue from scams and other prohibited ads was “rough and overly-inclusive”.
Meta declined to provide an updated figure.
“The assessment was done to validate our planned integrity investments – including in combatting frauds and scams – which we did,” Meta said. H
“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.”
"Over the past 18 months, we have reduced user reports of scam ads globally by 58 per cent and, so far in 2025, we’ve removed more than 134 million pieces of scam ad content.”
Additional reporting from agencies
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