Internal documents reviewed by Reuters indicate that Meta Platforms projected roughly 10 percent of its annual revenue, about US $16 billion, would come from advertisements connected to scams and banned goods in 2024. This revelation suggests that a significant portion of the advertising business on Meta’s platforms could be tied to campaigns that carry a high risk of fraud. The scale of this figure has drawn attention because it implies that scam-linked revenue is not an incidental issue but a substantial component of the company’s financial operations.

What kinds of ads are involved

The documents reveal a wide array of problematic advertisements. Fraudulent investment schemes, fake e-commerce offers, and illegal gambling campaigns were included among the ads flagged as high risk. Ads promoting banned medical products or services that claim to deliver legitimate results but do not were also highlighted. Platforms including Facebook, Instagram, and WhatsApp were specifically cited as showing users “higher-risk” scam ads, with up to 15 billion exposures per day recorded in December 2024.

This indicates that the issue extends far beyond fringe advertisers. High volumes of ads across Meta’s primary apps were associated with potential scams, suggesting a systemic concern rather than isolated cases.

The enforcement threshold

Meta has a system designed to flag potentially fraudulent advertisers, but the threshold for banning them entirely is set high. According to the company’s documents, an advertiser account is only deactivated if the system is 95% certain that fraud is occurring. If the suspicion of fraud falls below this threshold, the advertiser is not banned. Instead, the platform applies higher ad rates as a deterrent, referred to internally as “penalty bids.”

Some internal documents also show that the team reviewing questionable advertisers was instructed to avoid taking any actions that could reduce total revenue by more than 0.15%. This indicates that Meta appears to weigh the business implications of enforcement alongside the risk of fraudulent activity, reflecting a complex balancing act between protecting users and sustaining revenue.

Meta’s defence and response

In response to Reuters’ findings, Meta spokesperson Andy Stone clarified the company’s position. Meta described the 10% figure as rough and overly inclusive, noting that many of the ads counted were legitimate. The company emphasized its efforts in reducing scam ads, reporting a 58% decline in user complaints globally over the past 18 months and the removal of over 134 million scam ads from its platforms. Meta maintained that its documents presented a selective view and affirmed that fraud prevention remains a priority.

Broader implications

The issue goes beyond revenue figures. The revelation raises broader questions about responsibility in the digital advertising ecosystem and the safety of users. If one-tenth of Meta’s revenue comes from ads linked to scams or banned goods, there may be weaker incentives to enforce stricter policing of such ads. Users exposed to these campaigns face financial risk, while the platforms facilitating the ads share in the exposure. Advertisers and regulators are likely to demand more transparency in how ad campaigns are vetted and the level of risk tolerated.

What this means for users and advertisers

For users, vigilance is crucial. Ads that promise unusually high returns or involve medical or gambling offers should be approached with caution. Clicking once may trigger the algorithm to show many similar ads.

For advertisers, scam-related ads carry reputational risk by association. Platforms profiting from ads of questionable origin make it essential for brands to carefully monitor where their ad placements appear.

For platforms, this story signals a turning point. Increased scrutiny from regulators and the public may compel stronger standards or challenge existing business models.

Meta’s estimate that billions in ad revenue may be linked to scam ads serves as a wake-up call. The intersection of algorithmic scale, high revenue stakes, and complex enforcement thresholds makes this a pressing issue for accountability in the technology industry.