Oftentimes, the scam ads are present in Facebook or Instagram, and once a user clicks on one, it is more likely to be exposed to several more due to the company’s personalised-ad systems. — Reuters
Ads for fake products and scammy social media posts have carved their spot as a regular occurrence on digital platforms. Now, it appears Meta knowingly profits off of them.
According to 2024 documents reviewed by Reuters, the social media giant projected last year that it could earn up to US$16bil (RM66.42bil) from running ads featuring scams or banned goods. The projection amounts to around 10% of the company’s overall annual revenue.
The Mark Zuckerberg-led company currently has a US$1.3 trillion (RM5.40 trillion) market capitalisation as is a social media leader, owning Facebook, Instagram, Threads, and WhatsApp.
Reuter’s report found that Meta failed to stop around 15 billion “high risk” advertisements to its users every day, earning around US$7bil (RM29bil) in annualised revenue from ads showing clear signs of being fraud. Oftentimes, the scam ads are present in Facebook or Instagram, and once a user clicks on one, it is more likely to be exposed to several more due to the company’s personalised-ad systems.
“Much of the fraud came from marketers acting suspiciously enough to be flagged by Meta’s internal warning systems,” Reuters wrote. Yet advertisements only get blocked if there the system is at least 95% certain it is fraud. For high risk marketers who don’t meet that threshold, Meta charges they a higher fee, documents show.
While the higher fee aims to serve as a penalty, it also provided added revenue to the tech company.
“If regulators wouldn’t tolerate banks profiting from fraud, they shouldn’t tolerate it in tech,” former Meta safety investigator and fraud examiner Sandeep Abraham told Reuters.
“People on our platforms don’t want this content, legitimate advertisers don’t want it and we don’t want it either,” spoke person for Meta Andy Stone told Reuters. Stone noted the documents reviewed by Reuters were dont to validate “planned integrity investment,” with some of the documents vowing the tech company will do more. – Inc./Tribune News Service
