Meta accused of profiting from scam ads in class-action lawsuit

This week, a class-action lawsuit was filed in Washington, D.C. against Meta, alleging that the company deceived Facebook users about scam advertisements and profited from it.

Tycko and Zavareei LLP and Tech Justice Law filed the complaint on April 21 under the D.C. Consumer Protection Procedures Act on behalf of the Consumer Federation of America and Washington, D.C. Facebook users. The complaint states that while Meta publicly claims to fight scams, internal documents (published by Reuters in Dec. 2025) show it's making billions off of them.

The documents show that in 2024, Meta projected that around 10 percent of its revenue — around $16 billion — would come from advertising scam and banned products. Users are apparently exposed to 15 billion "high-risk" scam ads each day, per the documents. Meta apparently charged these high-risk advertisers more while rejecting 96 percent of valid user fraud reports.

"Meta has, as a matter of company policy, deliberately profited from rampant, inexcusable harm to users on its platforms," attorney and managing director at Tech Justice Law, Sarah Kay Wiley, stated in a press release. "Meta told its users it was fighting fraud. Internally, it was charging scammers a premium for access to those same users. That is not a failure of enforcement, that is a business model built on predatory deception."

A Meta spokesperson told Mashable, "These allegations misrepresent the reality of our work and we will fight them." 

"We aggressively combat scams across our platforms to protect people and businesses — last year alone, we removed over 159 million scam ads, 92 percent of which we took down before anyone reported them, and took down 10.9 million accounts on Facebook and Instagram associated with criminal scam centers. We fight scams because they are bad for business — people don't want them, advertisers don't want them, and we don't want them either," the spokesperson continued.

The complaint comes weeks after Meta announced new tools to fight scams on its platforms like Facebook and Instagram, including working with law enforcement. In recent years, Meta has reportedly rejected ads from legitimate businesses, like the sex toy shop Unbound (until they created fake ads targeted at men) and healthcare platform Daye.