Meta Sued by California County Over Facebook and Instagram “Scam” Ads

Meta has found itself again under legal pressure after Santa Clara County reportedly filed a lawsuit that raises serious questions about how the company handles advertising on its biggest platforms, Facebook and Instagram (via Bloomberg).

The lawsuit reportedly accuses Meta of violating California’s false advertising and unfair business practices laws, and defrauding “seniors and families with scam ads.” In a separate report, Reuters notes that the lawsuit is filed in the Santa Clara County Superior Court and cites its report from last December, alleging that may have earned up to $7 billion annually from so-called “high-risk” scam advertisements.

For those unaware, these ads reportedly show clear signs of fraud but were still allowed to circulate across its platforms. The county is seeking restitution, civil damages, and a court order that would block Meta from continuing what it calls unfair business practices.

That’s not all; the lawsuit also suggests Meta was aware of scam ads but did not fully clamp down. Rather, it implemented “guardrails” that limited enforcement when it risked hurting revenue. The lawsuit further claims that Meta’s systems, including its AI tools, may have helped scammers create more convincing ads.

Speaking of the scale of issue, Santa Clara County Counsel Tony LoPresti, in a statement to Reuters told, “The scale of Meta’s misconduct has reached ​an extraordinary level, and it needs to stop. As civil prosecutors in Silicon Valley, we have a special duty ‌to hold ⁠tech companies accountable to the law.”

In a related company news, Meta is reportedly facing internal backlash after introducing a new employee monitoring program directly related to its AI ambitions under CEO Mark Zuckerberg. The backlash comes as employees allegedly describe the monitoring system as invasive and raising concerns about workplace surveillance.