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Santa Clara County sues Meta over alleged scam ads
On Monday Santa Clara County filed a lawsuit against Meta alleging the tech giant of profiting from billions of fraudulent ads targeting vulnerable users.
SAN JOSE, Calif. - Santa Clara County filed a lawsuit Monday against Meta, alleging the tech giant profited from billions of fraudulent ads targeting vulnerable users.
Core allegations
What they're saying:
The complaint, led by County Counsel Tony LoPresti, alleges Meta — the parent company of Facebook and Instagram — has not only tolerated but "monetized and profited from fraud" through several practices, including algorithmic targeting.
According to the lawsuit, Meta’s algorithms identify vulnerable users, such as those who have previously clicked on suspicious links, and deliberately serve them more scam ads.
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The filing also alleges that when Meta’s internal systems flag advertisers as likely scammers, the company allows them to continue running ads at higher prices, described as "penalty bids."
Attorneys estimate Meta facilitates billions of scam ads daily, generating billions of dollars in annual revenue from high-risk advertising, according to the complaint.
The county further alleges Meta’s generative AI tools have been used by "bad actors" to create more convincing scam content.
Impact and testimony
The lawsuit highlights the human toll of scams, which range from fraudulent investment schemes to fake medical treatments.
Erin West, founder of the nonprofit Operation Shamrock, said victims often lose "every penny," with some cases ending in severe emotional distress or suicide.
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Meta’s response
The other side:
Meta said it plans to fight the lawsuit, calling the claims misleading.
What the county seeks
Local perspective:
The lawsuit, filed on behalf of California residents, seeks to hold Meta accountable for its alleged role in facilitating fraud.
County officials are seeking financial restitution for consumers, civil penalties, and a court order requiring changes to Meta’s advertising practices.
The case follows a similar lawsuit filed weeks earlier by the Consumer Federation of America in Washington, D.C., signaling increased legal scrutiny of social media advertising.
The Source: Santa Clara County District Attorney's Office, Meta Inc.