The $7 Billion Secret: Why Facebook and Instagram Keep Showing You Scam Adsf Facebook and Instagram
It’s a problem every user o knows too well: endless, suspicious ads promising quick riches, miracle cures, or unbelievably cheap products. Now, internal reports from Meta Platforms Inc., the parent company of both giants, reveal a shocking reason why these “high-risk” scam ads keep popping up: they are an enormous source of income.
According to documents analyzed by Reuters, Meta earns an estimated $7 billion yearly from these fraudulent advertisements, displaying a staggering 15 billion scam ads daily. This isn’t just a byproduct of a massive platform; it appears to be a systemic issue where profit is often prioritized over immediate user safety.
The Core Scandal: Profiting from Suspicion
The essence of the scandal boils down to Meta’s internal fraud policy. Here’s the simplest way to understand it:
The 95% Rule: Guilty Until Proven 95% Guilty
Meta uses automated tools to flag advertisers who look suspicious—meaning they are likely running scam ads promoting illegal gambling, fraudulent e-commerce, or banned medical products.
However, the internal documents show that Meta’s system only bans an advertiser if its tools are 95% certain that fraud is occurring.
What happens if the certainty falls below 95%? Instead of blocking the ad and protecting users, Meta allows the ad to run but charges the suspicious advertiser a higher advertising rate as a penalty.
Imagine a security guard seeing someone acting extremely suspiciously (say, 80% likely to be a shoplifter). Instead of stopping them, the guard lets them enter the store but charges them an extra fee at the door. Meta is essentially profiting from advertisers it already suspects are bad actors.
The Algorithm Problem
To make matters worse, Meta’s powerful ad-personalization algorithms—the software that decides what you see—automatically recommend similar content based on your activity. So, if you accidentally interact with one of those high-risk scam ads, Meta’s system actually thinks, “Ah, this user likes scams! Let’s show them more!” This creates a vicious cycle where victims are repeatedly targeted.
The Scale of the Scam Revenue
The estimated $7 billion in annualized revenue from these high-risk ads is a staggering amount, but the internal financial estimates are even broader.
Across Meta’s finance and safety divisions, staff estimated that scam and prohibited ads made up about 10.1% of the company’s total 2024 revenue, which translates to roughly $16 billion. Meta refers to this massive income stream as “violating revenue”—money earned specifically from advertising that breaks its own rules or regulatory laws.
The documents also highlighted the company’s strict internal tolerance for financial loss when fighting fraud. In early 2025, vetting teams were allegedly barred from taking enforcement actions if it risked losing the company more than 0.15% of its total revenue—a limit that essentially handcuffs safety teams to protect the bottom line.
Meta’s Defense vs. Global Scrutiny
In response to these revelations, Meta spokesperson Andy Stone defended the company, arguing that the documents present a “selective view” and that the 10.1% estimate was “rough and overly-inclusive.”
Stone noted that Meta has been fighting fraud aggressively, claiming to have reduced global user reports of scam ads by 58% over the past 18 months and removing 134 million scam ad posts in 2025 alone.
However, these defenses clash with Meta’s own internal findings:
US Fraud Dominance: A safety division report in May 2025 concluded that Meta platforms were involved in one-third of all successful scams in the United States.
Ease of Use for Scammers: Another internal review stated plainly that “it is easier to advertise scams on Meta than on Google.”
Regulatory Focus: Meta is currently under investigation by the U.S. Securities and Exchange Commission (SEC) over its role in facilitating financial scam ads, and a UK regulator found that Meta’s platforms were responsible for 54% of all payments-related scam losses in 2023—more than all other social platforms combined.
While Meta is taking action against spammy behavior and fake profiles, the fact remains that its core advertising policy creates a direct financial incentive to tolerate, and even profit from, high-risk, questionable advertisers.
This exposé places significant pressure on Meta to overhaul its internal policies and prioritize user safety over what has become a multi-billion-dollar stream of digital fraud revenue.
Given that Meta’s own internal reports suggest it’s “easier to advertise scams” on their platform than on Google, what kind of specific technical policy changes do you think Meta should implement to truly address the 95% certainty rule?
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