What is the method of the frequent 'fraudulent advertising of unrelated companies' that occurs on Instagram and Facebook?



Meta-owned Instagram and Facebook are rife with scams that pose as real companies and trick people into paying for products they don't sell. The Wall Street Journal has compiled a report on the reality of these scams.

Meta Battles an 'Epidemic of Scams' as Criminals Flood Instagram and Facebook - WSJ

https://www.wsj.com/tech/meta-fraud-facebook-instagram-813363c8

Australian mining magnate Andrew Forrest can sue Meta over Facebook scam ads, US court rules | Meta | The Guardian
https://www.theguardian.com/technology/article/2024/jun/19/metas-bid-to-dismiss-case-brought-by-andrew-forrest-over-facebook-scam-ads-dismissed-by-us-court

Edgar Guzman, who runs Half-Off Wholesale, an outlet for home improvement and gardening supplies outside Atlanta, has been plagued by scam ads on Meta for at least two years.

These scams sell things like power tools or a selection of Amazon.com returns at bargain prices, but then the buyer never receives the goods they pay for. And when angry customers call to complain, Guzman is forced to tell them they've been duped, unfortunately.

'What's really frustrating is having to tell our customers they've been scammed,' Guzman told The Wall Street Journal. 'We don't even sell online. We keep reporting this to Meta, telling them it's a fake website, but they're not doing anything about it.'

Mr. Guzman receives a call.


Photo: Nicole Craine for WSJ

Cases like this are not uncommon. According to a person familiar with the matter, in the year from the summer of 2023, nearly half of the fraud cases reported by financial company JP Morgan Chase to the remittance service Zelle were on Meta. The person said that other companies that offered Zelle had also reported many similar fraud cases originating from Meta.

A 2022 internal study cited in Meta's internal documents also found that 70% of newly active advertisers on the platform were promoting fraudulent, illegal or 'low-quality' products.

In the case of Guzman, a search of Meta's ad library in the spring of 2025 revealed that more than 4,400 ads featuring his business address had been run on Instagram and Facebook in the past year, of which only 15 were from Guzman's business.

The scam sites are from China, Sri Lanka, Vietnam and the Philippines, but the photos on their pages are taken from Half-Off Wholesale and the addresses are those of brick-and-mortar stores.

Meta's fraud problem continues to grow with the rise of cryptocurrencies, artificial intelligence, and vast criminal networks based in Southeast Asia, but the company has been slow to take action against its big-spending advertisers.

Adding to the problem is Facebook's

Marketplace , a second-hand goods site that lets Facebook users buy and sell items directly from one another. As well as being the most widely used classified ads platform on the internet, Marketplace is a prime target for scammers, according to The Wall Street Journal.

A Meta spokesperson stressed that the company is testing facial recognition technology, displaying warnings to users, and partnering with other companies to prevent fraud. 'This scam is becoming more persistent and sophisticated, so we are stepping up our efforts to combat it,' she said.



The US judiciary is forcing Meta to take a more aggressive stance through tougher sentences. US District Attorney Casey Pitts in San Jose, California, found Meta liable in a case involving fraudulent celebrity advertising.

In this case, Australian businessman Andrew Forrest, known as the 'iron ore tycoon,' sued Meta, alleging that Meta had unfairly profited from advertising investment scams using his image without his permission, and that Meta had failed in its reasonable duty to prevent such advertising.

Meanwhile, Meta sought to have the lawsuit dismissed, citing Section 230 of the Communications Decency Act , which provides immunity from liability for content created by third parties, but Prosecutor Pitts dismissed Meta's motion in a June 2024 ruling. This clears the way for Forest to sue Meta for damages based on the unauthorized use of his likeness and negligence.

In a statement, Forest said the ruling marks the first time a social media company has been unable to assert Section 230 immunity in a US civil lawsuit over its advertising business, adding that 'this is a crucial strategic victory in the fight to hold Facebook accountable.'

There have also been reports of scams on the Meta platform impersonating famous Japanese people such as Takafumi Horie and Atsushi Tamura.



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in Web Service,   Security, Posted by log1l_ks