Fake AI-generated shops, ads are flourishing on Facebook

The new iPhone, the Nintendo Switch 2, anything KPop Demon Hunters-related: these are the trending holiday gift items this year. And if you're on Facebook, there's a nonzero chance they are actually gifts that cyber criminals are pretending to sell in order to scam Facebook users.

These AI-generated products look like quality items, which the scammers then pitch at affordable prices. When a user clicks on the ad, which the scammer paid Facebook to serve, they are sent to the thieves' e-commerce storefront.

The consumer makes their purchase without realizing the item is a fake. They'll either receive a cheap imitation product, or never receive any item at all. 

According to a BBC investigation, consumers were scammed out of their money after falling for fake AI-generated images posing as C'est La Vie and Mabel & Daisy, family-run UK-based businesses selling products such as clothing and jewelry.

The stores do not actually exist; the e-commerce site is connected to a warehouse in China that ships cheap knockoffs.

The BBC heard directly from more than 60 people who fell victim to these scams after its report came out. Meta told the BBC it had removed those fraudulent companies from the platform. 

But what's to stop it happening again?

Facebook scams are nothing new. For years, fraudsters have weaponized the Facebook ads platform on a large scale. Meta makes, according to one analysis, a whopping $7 billion a year from scam ads alone.

Generative AI has only made scamming easier for cyber criminals, who can now generate convincingly real images and videos in an attempt to legitimize their fake shops. 

What can we do about this? Be extra careful this holiday season and remember the old adage: If a deal seems too good to be true, it probably is.