(AsiaGameHub) –   Meta is facing a lawsuit from the Consumer Federation of America (CFA), which alleges the company has misled users regarding its management of fraudulent advertisements on Facebook and Instagram.

The lawsuit contends that Meta permitted scam advertisements, including those promoting illegal gambling, in violation of consumer protection laws. The case centers on deceptive advertising practices rather than outright fraud, citing examples such as fake government payment notifications, “free iPhone” offers, and other misleading ads identified within Meta’s ad library.

Meta has refuted these accusations. Company spokesperson Chris Sgro stated that “these allegations misrepresent the reality of their work and they will fight them.”

According to Ben Winters, it remains easy to encounter objectionable advertisements. For instance, searches for ads related to terms like ‘free phone’ and ‘stimulus check’ revealed numerous questionable advertisements. An investigation also found that many active ads are being promoted in a manner that directs users to dubious financial schemes. However, Meta has not clarified whether these types of advertisements contravene their policies.

The CFA is seeking compensatory damages, the return of alleged profits, and a revision of Meta’s advertising policy enforcement. Winters believes that more stringent enforcement would help deter repeat offenders and prevent misleading advertisements from reaching users before they are exposed to them.

Spokesperson Chris Sgro said:

We aggressively combat scams across our platforms to protect people and businesses. Last year alone, we removed over 159 million scam ads, 92 percent of which we took down before anyone reported them, and took down 10.9 million accounts on Facebook and Instagram associated with criminal scam centers.

Meta’s substantial size has drawn increased scrutiny. Facebook, Instagram, and WhatsApp are among the largest social networks in the United States, offering advertisers access to a vast audience. Internal documents reportedly indicate that Meta’s platforms are a significant venue for global online scams, with one estimate suggesting it is “much easier to advertise scams on Meta platforms compared to Google.” Another internal source estimates that approximately 10.1% of overall revenue, equating to roughly $16 billion, is derived from scam-related or prohibited advertising. Meta has characterized this figure as “a very rough estimate and overly broad.”