Scams Explode on Meta Platforms
Online platforms owned by Meta are a significant source of internet fraud, according to findings from financial institutions and regulators. This issue impacts legitimate businesses and individuals alike, with scams ranging from fake product sales to bogus giveaways and fraudulent pet listings.
People attempting to purchase goods advertised on these platforms, such as home improvement supplies or returned merchandise offered at steep discounts, have sent money but never received the items. When they contact the legitimate businesses whose names and addresses are used in the scam ads, they are informed they have been defrauded. This creates problems for real businesses, leading to negative online reviews despite their lack of involvement in the online transactions. One business owner reported thousands of scam ads using his company’s details ran on Meta platforms over the past year, with only a small fraction originating from his actual business.
Financial institutions have reported that Meta platforms are a major origin point for scams. One large bank found that nearly half of all reported scams on its peer-to-peer payment service over a recent year originated on Meta. Other banks using the same payment service have reported similar findings. Regulators in the UK and Australia have also observed high levels of fraud originating from these platforms. An internal analysis from 2022 suggested that a large percentage of new advertisers were promoting scams or illicit goods.
The problem is extensive, with billions of users on Meta’s platforms. Factors like the rise of cryptocurrencies and the involvement of large overseas crime networks are contributing to the growing scale and complexity of the fraud. These networks are reportedly based in various countries including China, Sri Lanka, Vietnam, and the Philippines. Some reports suggest that individuals, many trafficked after responding to fake job ads, are forced to participate in these scamming operations from secure compounds. Experts in law enforcement argue that social media platforms could significantly impact this illicit industry.
Internal discussions and documents suggest that Meta has historically given lower priority to scam enforcement compared to other issues. Decisions have been made to avoid measures like advertiser verification, partly due to concerns about losing revenue. While the company states it is increasing efforts and testing new technologies like facial recognition and partnering with banks, it has also argued in court that it is not legally responsible for addressing fraud originating from user content on its platforms. A company spokesman stated that Meta does not want scam activity on its platform, despite its legal stance.
Users have lost substantial amounts of money, sometimes hundreds of dollars, through various scams. Examples include small “shipping fees” that lead to unauthorized charges and payments for non-existent pets. Many users who have reported scams find the issue persists. The company states it is taking down millions of accounts linked to organized fraud, with many caught quickly, and has been increasing investment in anti-scam efforts since late 2022. However, internal analyses from 2022 indicated a decline in reviews of potentially fraudulent activity within certain parts of the platform following changes in content moderation priorities.
