Meta, the parent company of Facebook and Instagram, is being sued by the Consumer Federation of America (CFA) in the Superior Court of the District of Columbia. The CFA claims that the social media giant has earned profits from ads promoting fraudulent activities, including scam gambling sites, and has misled users about its efforts to combat the issue.
According to the CFA, Meta has implemented policies and practices that knowingly allow scam advertisements to spread across its platforms while simultaneously profiting from those ads at the expense of its users. The group also accused Meta of downplaying the extent of fraud on its apps, thereby creating a “false impression of safety” for users.
Ben Winters, the director of AI and data privacy at the CFA, stated that as Americans continue to lose more money to online scams, Meta has consistently prioritized profit over user safety. The CFA argues that Meta’s actions violate a consumer protection law in Washington, D.C.
According to the organization, by misleading users into gambling on these illegal websites and apps, the CFA argues that Meta is complicit and acts as a “pillar” of the “global fraud economy.” The nonprofit organization is seeking damages along with the recovery of what it claims were illegal profits earned by the tech giant through its ads.
Of course, this isn’t the first time that Meta has come under fire for allegedly promoting illegal gambling ads and scam websites on its platforms. For example, a couple of months ago, the UK Gambling Commission criticized Meta for apparently trying to maintain ties to the legal gaming industry, while still allowing advertisers to promote unlicensed companies.
In response to the CFA’s legal action, Meta stated that the allegations misrepresent the reality of its work and that it intends to contest them. The company also pointed to a recent announcement in which it said it had expanded its advertiser verification efforts and begun prohibiting financial services-related ads from directing users to private messaging services, a tactic commonly used by financial scammers.
A Meta spokesperson also stated that, in the previous year alone, the company removed over 159 million scam ads, 92% of which were taken down before being reported. Additionally, it also removed 10.9 million accounts on Facebook and Instagram linked to criminal scam centers. The company also mentioned that it continues to invest in new technologies to fight securities investment and other types of scams.
However, it appears that these reassurances are insufficient for the CFA, as the organization is proposing a class-action lawsuit involving Meta users based in Washington, D.C., and is seeking a jury trial.
