San Francisco: Meta developed an internal “playbook” aimed at delaying regulatory pressure to crack down on scam advertising on Facebook and Instagram, according to a Reuters Special Report published on December 31.
Citing internal company documents reviewed by Reuters, the report says the social media giant adopted tactics to make fraudulent ads harder for regulators to find, while resisting measures such as universal advertiser verification that could reduce scams but also affect revenue.
The documents, drawn from Meta’s legal, public policy, safety and finance teams over the past four years, detail how the company responded to mounting scrutiny from governments worldwide over fraudulent advertising. Reuters reported that Meta feared mandatory verification rules could cost billions of dollars in lost ad revenue.
One key tactic involved Meta’s public Ad Library, a searchable database meant to promote transparency. According to the documents, Meta identified keywords and celebrity names commonly used by regulators to locate scam ads and then repeatedly ran those searches, removing ads flagged as fraudulent. The approach reduced the number of problematic ads appearing in search results, making them less “discoverable” to regulators, investigators and journalists, the report said.
Former Meta fraud investigator Sandeep Abraham, now a cybersecurity consultant, described the strategy as “regulatory theatre,” arguing that it distorted the purpose of the Ad Library. Meta rejected that characterization, saying the removal of scam ads from search results reflected genuine enforcement efforts.
The Reuters report said the strategy was first deployed in Japan, where regulators were considering stricter advertiser verification rules after a surge in scam ads involving fake investment schemes and AI-generated celebrity endorsements. Following Meta’s clean-up efforts, Japanese authorities did not impose the feared verification mandate.
Encouraged by the outcome, Meta expanded the approach into what internal documents described as a “general global playbook”, applying it in markets including the United States, Europe, India, Australia and Brazil, according to Reuters.
The documents also reveal Meta’s reluctance to adopt universal advertiser verification, a system already implemented by Google, which has verified more than 90% of its advertisers. Meta’s internal analyses acknowledged that verification would significantly reduce scam ads but estimated the move could cost the company about $2 billion to implement and lead to revenue losses of up to 4.8%.
Despite generating nearly all of its $164.5 billion annual revenue from advertising, Meta opted for what documents described as a “reactive only” approach — adopting verification only where legally mandated, such as in Taiwan and Singapore.
In Taiwan, where authorities imposed strict verification rules for financial advertisers, Meta complied after regulators warned that fines could exceed the company’s local profits. According to Taiwanese officials cited by Reuters, scam investment ads dropped sharply following the reforms.
However, Meta’s own internal assessments found that when scam ads were blocked in one country, they were often rerouted by its systems to other markets, effectively shifting consumer harm rather than eliminating it.
Reuters previously reported that scam ads Meta considers “high risk” generate up to $7 billion annually. Following Reuters’ investigations, US senators urged federal regulators to examine the company’s practices, while the US Virgin Islands filed a lawsuit accusing Meta of profiting from scams — allegations the company has denied.
European regulators have also sought information from Meta about its handling of scam ads, with a European Commission spokesperson telling Reuters there were “doubts about compliance.”
According to the documents, Meta internally ranked fraudulent advertising as its highest regulatory and reputational risk in 2025, even as staff celebrated success in slowing or weakening regulatory action in several jurisdictions.
