{"id":5692,"date":"2026-05-12T23:31:32","date_gmt":"2026-05-12T23:31:32","guid":{"rendered":"https:\/\/siliconvalleymovingpost.com\/?p=5692"},"modified":"2026-05-12T23:31:32","modified_gmt":"2026-05-12T23:31:32","slug":"silicon-valley-county-sues-meta-alleging-it-made-billions-from-scam-ads","status":"publish","type":"post","link":"https:\/\/siliconvalleymovingpost.com\/?p=5692","title":{"rendered":"Silicon Valley county sues Meta, alleging it made billions from scam ads"},"content":{"rendered":"
\n

Santa Clara County sued Meta on Monday, accusing the tech giant of turning scam advertisements on Facebook and Instagram into a multibillion-dollar revenue stream while Californians lost billions to online fraud.<\/p>\n

Read more UCLA women\u2019s basketball coach Cori Close gets new contract<\/a><\/p>\n

The lawsuit alleges Meta knowingly allowed fraudulent ads to remain on its platforms, charged higher prices for some flagged ads and limited enforcement when fraud prevention threatened the company\u2019s bottom line.<\/p>\n

The case puts a Silicon Valley county in direct conflict with one of the world\u2019s most powerful tech companies over who should bear responsibility for fraud that spreads through online advertising systems.<\/p>\n

County officials described the case as the first such lawsuit by a local civil prosecutor in the nation targeting a major tech company over allegations that it knowingly enabled and profited from widespread deception and unfair business practices.<\/p>\n

The lawsuit, filed in Santa Clara County Superior Court, accuses Meta of violating California\u2019s false advertising and unfair competition laws and seeks restitution, civil penalties and a court order requiring the company to change its practices.<\/p>\n

\u201cThis case is about accountability. It\u2019s about ensuring that as behemoth tech companies open up new frontiers in our society, that they aren\u2019t lawless frontiers,\u201d Santa Clara County Counsel Tony LoPresti said Monday at a news conference. \u201cMeta has lied to its users and violated the law for years.\u201d<\/p>\n

LoPresti alleges that Meta\u2019s internal documentation shows that the company\u2019s platforms host about one-third of all internet scams \u2014 resulting in $2.5 billion in losses for California residents in 2024, county officials said. These scam advertisements boast products ranging from fake financial products and miracle cures for incurable diseases to recreations of celebrities requesting money and cryptocurrency scams.<\/p>\n

The lawsuit cites findings from a Reuters investigation that found internal Meta documents estimated 15 billion \u201chigher risk\u201d scam ads are shown to users on the company\u2019s social media platforms each day, generating $7 billion in annual revenue.<\/p>\n

\n<\/div>\n

Although Meta is headquartered in Menlo Park, in neighboring San Mateo County, LoPresti said he is bringing the case as a civil prosecutor under California consumer protection laws, alleging Meta\u2019s scam-ad practices harmed residents statewide.<\/p>\n

LoPresti said the county has a particular responsibility to act because it sits \u201cat the heart of Silicon Valley\u201d and has benefited from the tech boom, so it cannot \u201csit idly by\u201d while a \u201ctech giant is swindling the public.\u201d He also cited his office\u2019s previous lawsuits against corporations as part of its broader effort to protect vulnerable residents.<\/p>\n

In a statement, Meta denied the county\u2019s allegations, saying the claim relies on Reuters reporting that it said \u201cdistorts our motives\u201d and \u201cignores\u201d its efforts to fight scams.<\/p>\n

\u201cWe aggressively fight scams on and off our platforms because they\u2019re not good for us or the people and businesses that rely on our services,\u201d a Meta spokesperson said. \u201cWe removed over 159 million scam ads last year alone, launched new tools to protect people, and partnered with law enforcement around the globe to disrupt these criminals. We will fight this lawsuit.\u201d<\/p>\n

\n<\/div>\n

The county alleges that Meta\u2019s internal systems flag ads that are likely scams but allow some to run for a higher price instead of stopping them, according to the lawsuit.<\/p>\n

\u201cAccording to a recent investigation (by Reuters), even though Meta\u2019s internal warning systems might flag advertisements that are highly likely to be fraudulent, Meta allows those advertisements to post for a premium price,\u201d LoPresti said. \u201cIn other words, Meta has established a system for monetizing and profiting from fraud, and it\u2019s clear that Meta is taking careful steps to ensure that its revenue from scam ads continues to flow.\u201d<\/p>\n

Internal documents from Meta uncovered in the Reuters investigation noted that the company\u2019s safety staff estimated that out of 100,000 weekly valid scam reports filed in 2023 by users who reported being messaged by fraudsters, Meta ignored or improperly rejected 96% of those, LoPresti said.<\/p>\n

Read more Nneka Ogwumike says Sparks\u2019 defense is key against Caitlin Clark and Fever<\/a><\/p>\n

A 2024 internal report cited in the lawsuit found that financial fraud advertisers were often allowed to accumulate between eight and 32 automated warnings before Meta disabled them, according to the lawsuit. It further cites findings by the Reuters investigation that some \u201chigh value accounts\u201d were still on Meta\u2019s platforms after being reported more than 500 times.<\/p>\n

The county alleges that Meta internally refers to revenue from fraudulent or otherwise prohibited ads as \u201cviolating revenue\u201d and that those ads generate $7 billion in annual revenue. It further alleges that Meta anticipated that the revenue would draw penalties of $1 billion, but that \u201cthose fines would be much smaller than Meta\u2019s revenue from scam ads,\u201d according to the lawsuit.<\/p>\n

\u201cMeta might talk about its efforts to remove scam ads,\u201d LoPresti said. \u201cBut that talk is a scam just like the scam advertisement themselves.\u201d<\/p>\n

The lawsuit also alleges that Meta\u2019s artificial intelligence tools help create and refine scam ads, often making them more misleading. It also claims thousands of Meta-approved \u201cBusiness Partners\u201d advertise services to help clients post scam ads on the company\u2019s platforms.<\/p>\n

The county alleges those fraudulent ads raise prices for legitimate advertisers bidding in Meta\u2019s ad auctions.<\/p>\n

Meta is further accused of having internal \u201crevenue guardrails\u201d that limit its enforcement against scam ads. LoPresti said the company implemented restrictions barring fraud prevention teams from taking steps projected to cost more than 0.15% of Meta\u2019s revenue.<\/p>\n

The lawsuit also alleges Meta\u2019s algorithms can show more fraudulent ads to users who have already clicked on one, compounding the harm for vulnerable groups. The FBI has found that scam ads disproportionately impact people over the age of 60, and a Pew Research study has found that Black, Latino and Asian individuals are more likely to experience multiple instances of fraud than white people, LoPresti added.<\/p>\n

Eric Goldman, a professor of law at Santa Clara University School of Law and co-director of the High Tech Law Institute, said Meta may invoke Section 230, a federal law that generally shields websites from liability for third-party content, including advertising.<\/p>\n

But Goldman said other legal theories may also come into play, including arguments focused less on the scam ads themselves and more on how Meta interacted with advertisers or allegedly overcharged them because of illegitimate bidders.<\/p>\n

\u201cMeta has invoked Section 230 in lawsuits over scammy ads before, and historically has won that argument,\u201d Goldman said. \u201cIt has prevailed on the basis that Meta is not responsible for its advertisers\u2019 content.\u201d<\/p>\n

Goldman added that \u201cultimately, it\u2019s about a trust relationship with the consumer.\u201d He said the evidence generated by the Reuters investigation, and relied on by the plaintiffs, suggests Facebook may have needed to act more aggressively against known scam ads.<\/p>\n

\u201cThe law may or may not recognize that, but it\u2019s still a problem Facebook has to be concerned about,\u201d he said.<\/p>\n

The lawsuit follows a recent case filed in Washington, D.C., by a consumer protection group alleging that Meta generated revenue from advertisements for fraudulent activities, which also cited Reuters reporting. It also comes amid broader legal scrutiny of Meta over harms tied to its platforms, including a recent California jury verdict finding the company liable in a social media addiction case\u00a0involving young users, a verdict Meta is now asking a judge to overturn.<\/p>\n

\u201cSanta Clara County sits at the heart of Silicon Valley, and while our region has certainly benefited from the tech boom, we can\u2019t sit idly by when we know good and well that a tech giant is swindling the public to hit a revenue target,\u201d LoPresti said. \u201cTech might be the lifeblood of Silicon Valley, and we benefit from it and we celebrate that, but we can\u2019t allow poison into that bloodstream.\u201d<\/p>\n

Read more Funko accused of collecting user data without permission<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The lawsuit further alleges that the tech giant’s practices harm consumers and increase advertising prices for legitimate businesses. <\/p>\n","protected":false},"author":1,"featured_media":5691,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-5692","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"yoast_head":"\nSilicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/siliconvalleymovingpost.com\/?p=5692\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Silicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post\" \/>\n<meta property=\"og:description\" content=\"The lawsuit further alleges that the tech giant's practices harm consumers and increase advertising prices for legitimate businesses.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/siliconvalleymovingpost.com\/?p=5692\" \/>\n<meta property=\"og:site_name\" content=\"Silicon Valley Moving Post\" \/>\n<meta property=\"article:published_time\" content=\"2026-05-12T23:31:32+00:00\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/#\\\/schema\\\/person\\\/636e2e5a10a21cf87fe6eb5951e8a6b7\"},\"headline\":\"Silicon Valley county sues Meta, alleging it made billions from scam ads\",\"datePublished\":\"2026-05-12T23:31:32+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692\"},\"wordCount\":1320,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/230ea1305284fd364e9637f75e5737ac.webp\",\"articleSection\":[\"Business\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692\",\"url\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692\",\"name\":\"Silicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/230ea1305284fd364e9637f75e5737ac.webp\",\"datePublished\":\"2026-05-12T23:31:32+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/#\\\/schema\\\/person\\\/636e2e5a10a21cf87fe6eb5951e8a6b7\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#primaryimage\",\"url\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/230ea1305284fd364e9637f75e5737ac.webp\",\"contentUrl\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/230ea1305284fd364e9637f75e5737ac.webp\",\"width\":1024,\"height\":682},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?p=5692#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Silicon Valley county sues Meta, alleging it made billions from scam ads\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/#website\",\"url\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/\",\"name\":\"Silicon Valley Moving Post\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/#\\\/schema\\\/person\\\/636e2e5a10a21cf87fe6eb5951e8a6b7\",\"name\":\"admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g\",\"caption\":\"admin\"},\"sameAs\":[\"http:\\\/\\\/siliconvalleymovingpost.com\"],\"url\":\"https:\\\/\\\/siliconvalleymovingpost.com\\\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Silicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/siliconvalleymovingpost.com\/?p=5692","og_locale":"en_US","og_type":"article","og_title":"Silicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post","og_description":"The lawsuit further alleges that the tech giant's practices harm consumers and increase advertising prices for legitimate businesses.","og_url":"https:\/\/siliconvalleymovingpost.com\/?p=5692","og_site_name":"Silicon Valley Moving Post","article_published_time":"2026-05-12T23:31:32+00:00","author":"admin","twitter_card":"summary_large_image","twitter_misc":{"Written by":"admin","Est. reading time":"7 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#article","isPartOf":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692"},"author":{"name":"admin","@id":"https:\/\/siliconvalleymovingpost.com\/#\/schema\/person\/636e2e5a10a21cf87fe6eb5951e8a6b7"},"headline":"Silicon Valley county sues Meta, alleging it made billions from scam ads","datePublished":"2026-05-12T23:31:32+00:00","mainEntityOfPage":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692"},"wordCount":1320,"commentCount":0,"image":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#primaryimage"},"thumbnailUrl":"https:\/\/siliconvalleymovingpost.com\/wp-content\/uploads\/2026\/05\/230ea1305284fd364e9637f75e5737ac.webp","articleSection":["Business"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/siliconvalleymovingpost.com\/?p=5692#respond"]}]},{"@type":"WebPage","@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692","url":"https:\/\/siliconvalleymovingpost.com\/?p=5692","name":"Silicon Valley county sues Meta, alleging it made billions from scam ads - Silicon Valley Moving Post","isPartOf":{"@id":"https:\/\/siliconvalleymovingpost.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#primaryimage"},"image":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#primaryimage"},"thumbnailUrl":"https:\/\/siliconvalleymovingpost.com\/wp-content\/uploads\/2026\/05\/230ea1305284fd364e9637f75e5737ac.webp","datePublished":"2026-05-12T23:31:32+00:00","author":{"@id":"https:\/\/siliconvalleymovingpost.com\/#\/schema\/person\/636e2e5a10a21cf87fe6eb5951e8a6b7"},"breadcrumb":{"@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/siliconvalleymovingpost.com\/?p=5692"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#primaryimage","url":"https:\/\/siliconvalleymovingpost.com\/wp-content\/uploads\/2026\/05\/230ea1305284fd364e9637f75e5737ac.webp","contentUrl":"https:\/\/siliconvalleymovingpost.com\/wp-content\/uploads\/2026\/05\/230ea1305284fd364e9637f75e5737ac.webp","width":1024,"height":682},{"@type":"BreadcrumbList","@id":"https:\/\/siliconvalleymovingpost.com\/?p=5692#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/siliconvalleymovingpost.com\/"},{"@type":"ListItem","position":2,"name":"Silicon Valley county sues Meta, alleging it made billions from scam ads"}]},{"@type":"WebSite","@id":"https:\/\/siliconvalleymovingpost.com\/#website","url":"https:\/\/siliconvalleymovingpost.com\/","name":"Silicon Valley Moving Post","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/siliconvalleymovingpost.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/siliconvalleymovingpost.com\/#\/schema\/person\/636e2e5a10a21cf87fe6eb5951e8a6b7","name":"admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/50b1ad2e498f523425ee0a8cc5180a210646db1622662a3d56cc405d3e0c346a?s=96&d=mm&r=g","caption":"admin"},"sameAs":["http:\/\/siliconvalleymovingpost.com"],"url":"https:\/\/siliconvalleymovingpost.com\/?author=1"}]}},"_links":{"self":[{"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/posts\/5692","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=5692"}],"version-history":[{"count":0,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/posts\/5692\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=\/wp\/v2\/media\/5691"}],"wp:attachment":[{"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=5692"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=5692"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/siliconvalleymovingpost.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=5692"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}