Bombshell report exposes how Meta relied on scam ad profits to fund AI

Internal documents have revealed that Meta has projected it earns billions from ignoring scam ads that its platforms then targeted to users most likely to click on them.

In a lengthy report, Reuters exposed five years of Meta practices and failures that allowed scammers to take advantage of users of Facebook, Instagram, and WhatsApp.

Documents showed that internally, Meta was hesitant to abruptly remove accounts, even those considered some of the “scammiest scammers,” out of concern that a drop in revenue could diminish resources needed for artificial intelligence growth.

Instead of promptly removing bad actors, Meta allowed “high value accounts” to “accrue more than 500 strikes without Meta shutting them down,” Reuters reported. The more strikes a bad actor accrued, the more Meta could charge to run ads, as Meta’s documents showed the company “penalized” scammers by charging higher ad rates. Meanwhile, Meta acknowledged in documents that its systems helped scammers target users most likely to click on their ads.

“Users who click on scam ads are likely to see more of them because of Meta’s ad-personalization system, which tries to deliver ads based on a user’s interests,” Reuters reported.

Internally, Meta estimates that users across its apps in total encounter 15 billion “high risk” scam ads a day. That’s on top of 22 billion organic scam attempts that Meta users are exposed to daily, a 2024 document showed. Last year, the company projected that about $16 billion, which represents about 10 percent of its revenue, would come from scam ads.

“High risk” scam ads strive to sell users on fake products or investment schemes, Reuters noted. Some common scams in this category that mislead users include selling banned medical products, or promoting sketchy entities, like linking to illegal online casinos. However, Meta is most concerned about “imposter” ads, which impersonate celebrities or big brands that Meta fears may halt advertising or engagement on its apps if such scams aren’t quickly stopped.