A recent investigation by Reuters has revealed that a significant portion of Meta’s revenue comes from illegal and fraudulent advertisements.

Following the release of its latest quarterly results, internal documents have shown that in 2024, nearly 10% of the company’s revenue, equivalent to $16 billion, was generated from ads related to scams or prohibited products.

Billions Earned from Advertising Scams

An internal document dated December 2024 indicates that every day, 15 billion fraudulent ads circulate on Facebook, Instagram, and WhatsApp. These ads include promotions for illegal casinos, non-existent investment opportunities, fake e-commerce websites, and banned medications.

Despite this deluge, moderation measures seem insufficient: Meta only blocks an advertiser if its algorithms are 95% certain that it involves fraud.

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If not, the company implements a “strong>penalty bids” system: suspected fraudsters pay more for their ad campaigns, which allows Meta to retain some of the revenue while claiming to combat abuse. According to the documents, this policy has generated $7 billion per year from these ads alone.

Regulators Struggle with Meta’s Inaction

The revelations from Reuters show that Meta has deliberately limited the financial impact of its anti-fraud efforts. By 2025, its teams were not allowed to take any action that would result in a loss of more than 0.15% of its revenue, which amounts to about $135 million over six months.

Additionally, the company believed that cracking down on scams could harm its business projections, thus hindering any vigorous action.

Even more disturbing, an internal study from April 2025 stated that it’s easier to scam on Meta than on Google, highlighting the California-based giant’s struggle to create a safe advertising ecosystem.

These practices have now drawn the attention of U.S. and British authorities, who are investigating Meta’s role in the spread of online scams…

A Business Model under Pressure…

When questioned by Reuters, Meta’s spokesperson, Andy Stone, criticized what he called a “selective” view of the issue, claiming that the internal estimates were “too broad” and included “many legitimate ads”.

He even stated that scam reports have decreased by 58% over 18 months, while acknowledging that fighting fraud does impact the company’s revenue.

However, Meta plans only to gradually reduce the share of revenue from illegal ads: 7.3% in 2025, 6% in 2026, down to 5.8% in 2027. This trajectory illustrates the company’s challenge in balancing economic performance with the integrity of its platforms…