Rhode Island sues Meta over alleged scam advertising profits

Rhode Island Attorney General Peter Neronha has filed a lawsuit against Meta Platforms in Providence Superior Court, alleging the company knowingly allowed widespread scam advertising to proliferate across Facebook, Instagram, and WhatsApp to generate billions in profits.

The complaint accuses Meta of violating state laws by profiting from fraudulent e-commerce, questionable health products, and other prohibited advertising formats. Internal documents cited in the suit suggest that Meta may display approximately 15 billion “highly risky” advertisements daily, and as much as 10 percent of its 2024 revenue could have originated from deceptive formats. The lawsuit further alleges that Meta’s AI-driven advertising tools helped create and optimize these scams rather than blocking them.

Rhode Island is seeking civil penalties for each violation, restitution for consumers, the disgorgement of illegal profits, and a judicial order forcing the company to actively combat scams. This marks the first such state-level lawsuit in the U.S. regarding these specific allegations, following a similar action by Santa Clara County, California, in May.

Meta has dismissed the lawsuit as “unfounded,” stating that the company removed over 159 million scam ads in the last year and has implemented new security measures, including advertiser verification and suspicious activity alerts.