"The complaint, filed in Santa Clara County Superior Court on behalf of all California residents, seeks restitution, civil damages, and a court order prohibiting Meta from engaging in unfair business practices. According to the complaint, Meta's revenue from so-called “high-risk” advertising - ads that displayed obvious indicators of fraud - may have totaled as much as $7 billion in a single year."
"Internal documents, first surfaced by Reuters and cited extensively in the filing, form the backbone of the county's argument that Meta deliberately capped its own enforcement activity whenever anti-fraud measures risked cutting into ad income. Among the specific practices cited in the complaint: third-party brokers were permitted to sell ad accounts that carried protection from removal; users who had engaged with dubious ads were then served more of the same; and the county says Reuters' own testing revealed that Meta's AI-powered creative tools could be used to generate promotional content for fraudulent schemes."
"Woven through the complaint is the claim that Meta's public reassurances about ad safety - including statements framing fraud enforcement as a priority - masked the extent to which the company was financially dependent on the very ads it claimed to be policing. “On information and belief, Meta can even adjust the flood of scam ads it allows on its platforms in order to smooth its earnings or hit specific revenue targets,” the filing states."
"“The scale of Meta's misconduct has reached an extraordinary level, and it needs to stop,” Santa Clara County Counsel Tony LoPresti told Reuters. “As civil prosecutors in Silicon Valley, we have a special duty to hold tech companies accountable to the law.”"
Santa Clara County filed a lawsuit against Meta on behalf of all California residents, alleging violations of California false advertising and unfair business practices laws. The complaint seeks restitution, civil damages, and an order barring Meta from engaging in unfair business practices. The filing alleges Meta profited from “high-risk” ads that showed obvious fraud indicators, with revenue potentially reaching $7 billion in a year. It cites internal documents indicating Meta deliberately limited enforcement when anti-fraud actions threatened ad income. The complaint alleges third-party brokers could sell ad accounts with protection from removal, users who interacted with dubious ads were shown more of the same, and Meta’s AI tools could generate promotional content for fraudulent schemes. It also alleges Meta’s public assurances about ad safety masked financial dependence on scam ads.
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