Meta Funded AI with Scam Ad Revenue, Report Reveals
▼ Summary
– Meta internally projected earning billions from scam ads by targeting users most likely to click on them, according to internal documents.
– The company allowed high-value scam accounts to accumulate over 500 strikes without removal, fearing revenue loss could hinder AI development.
– Meta’s ad-personalization system shows more scam ads to users who click on them, based on their interests and behavior.
– Users encounter 15 billion high-risk scam ads and 22 billion organic scam attempts daily across Meta’s apps, as per 2024 documents.
– Meta estimated $16 billion (10% of revenue) would come from scam ads last year, with imposter ads posing the biggest concern due to potential advertiser backlash.
A recent investigation has uncovered that Meta reportedly generated billions in revenue from scam advertisements, which its own systems actively targeted toward users most susceptible to engaging with them. Internal documents spanning five years detail how the company’s platforms, Facebook, Instagram, and WhatsApp, repeatedly failed to curb fraudulent activity, enabling scammers to exploit millions of users.
According to the report, Meta internally hesitated to remove accounts linked to fraudulent behavior, even those described as the “scammiest scammers.” The company’s reluctance stemmed from fears that a sudden drop in advertising income could hamper its ambitious artificial intelligence development initiatives. Rather than taking swift action, Meta permitted what it termed “high value accounts” to accumulate hundreds of violations without suspension.
Documents revealed that instead of banning repeat offenders, Meta imposed financial penalties by charging them higher rates for advertisements. This approach effectively turned enforcement into a revenue stream. At the same time, the company’s own ad-targeting algorithms helped scammers pinpoint users most inclined to click on deceptive content. One internal acknowledgment noted that individuals who engaged with one scam ad were likely to encounter more, due to Meta’s personalization systems designed to show ads aligned with user interests.
Internal estimates from 2024 indicate that Meta users collectively face approximately 15 billion high-risk scam ads every day. This staggering figure is in addition to another 22 billion daily organic scam attempts that circulate throughout its platforms. Last year, the company projected that roughly $16 billion, about 10 percent of its total revenue, would originate from these fraudulent advertisements.
High-risk scam ads typically promote counterfeit goods, fraudulent investment opportunities, or prohibited items such as unapproved medical products. They also include promotions for dubious entities like illegal online casinos. However, Meta expressed particular concern over “imposter” ads, which misuse the likeness of celebrities or established brands. The company worries that such impersonations could prompt legitimate advertisers or public figures to reduce their presence on Meta’s platforms if the issue is not addressed promptly.
(Source: Ars Technica)
