Meta Must Enhance Protections Against Financial Scams
California Takes a Stand Against Investment Scams on Meta Platforms
OAKLAND — In a bold move, California Attorney General Rob Bonta, leading a bipartisan coalition of 42 attorneys general, has urged Meta to address the alarming surge of fraudulent investment advertisements plaguing its platforms, particularly on Facebook newsfeeds. These deceptive ads pose a dire threat to consumers across the nation, sometimes costing individuals their life savings. Attorney General Bonta and his colleagues are demanding immediate action from Meta to bolster its detection and eradication of these scams.
The Alarming Reality of Investment Scam Ads
“It’s shocking how effortlessly investment scam ads — which have devastated countless consumers — can proliferate on Meta’s platforms,” stated Attorney General Bonta. “The combination of these ads’ omnipresence and Meta’s ineffective identification methods creates a perilous situation for users.” Drawing attention to the gravity of the issue, he called for Meta to prioritize user safety and take a stand against these harmful advertisements.
How These Scams Deceive Users
Investment scam ads exploit the trust of users by featuring images of well-known investors, leading consumers to believe they are legitimate. Upon clicking, users are prompted to download WhatsApp and join groups unauthorized by the investors depicted. Here, they become targets of illegal investment schemes, often referred to as “pump and dump” operations. Scammers encourage victims to invest in penny stocks, artificially inflating the stock prices before cashing out, leaving users with worthless shares and significant financial losses. The fallout can be catastrophic, affecting not just finances but also mental wellbeing and social standing.
Call to Action: Improve Detection or Ban Ads
In their letter, the attorneys general insist that Meta adopt effective protocols to combat this menace. If such measures are not implemented, they urge Meta to reconsider allowing investment ads on its platforms altogether. Despite the company’s use of automated systems coupled with human oversight, these efforts have proven insufficient, allowing numerous scam ads to slip through the cracks.
A Pattern of Neglect and Lack of Protection
This letter serves not only as a warning about investment scams but also highlights Meta’s ongoing failures to protect its users from various harmful content. Earlier this year, Attorney General Bonta, alongside a bipartisan coalition, filed a lawsuit against Meta for its detrimental impact on youth mental health through addictive features on Instagram and Facebook. This lawsuit remains unresolved.
Moreover, just last year, Bonta dispatched another letter to Meta about the alarming rise in account takeovers and lockouts on Facebook and Instagram, criticizing the company’s inadequate response to consumer reports of harm.
A Unified Front for Consumer Protection
In lending support to Attorney General Bonta, the coalition includes attorneys general from a multitude of states, including Connecticut, New Hampshire, New York, and many more, showcasing a united front against financial fraud.
For further insights, a copy of the full letter addressed to Meta can be found here.
