Rhode Island has sued Meta, alleging the company profited from scam ads on Facebook, Instagram, and WhatsApp and helped to create some of them.
Attorney General Peter Neronha filed the complaint in Providence County Superior Court on October 22. It says Meta broke the state’s consumer protection law while telling users it was keeping them safe.
Rhode Island is the first US state to bring a scams case against Meta, as California’s Santa Clara County filed a similar suit in May.
“As alleged, Meta knowingly exposed vulnerable users to fraud and scams, and made enormous profits in doing so,” Neronha said in a statement.
The complaint draws on reporting by Reuters last year on internal Meta documents.
Those documents showed Meta estimated it showed users about 15 billion high-risk scam ads a day. Meta also projected that about 10% of its 2024 revenue, around $16bn, would come from ads for scams and banned goods.
The state alleges that Meta’s AI advertising tools sometimes helped scammers.
It also says Meta charged some suspected fraudsters higher ad prices instead of blocking them, and opposed rules that would make advertisers verify who they are.
“A banned advertiser can reappear in the time it takes to provide a new email address or phone number,” the complaint says.
Examples in the suit include an ad promising to reverse Alzheimer’s disease in 45 days, which ran in more than 2,000 versions in Meta’s Ad Library.
Others impersonated a senior Bank of America executive to lure users into stock-trading scams on WhatsApp.
Rhode Island wants civil penalties for each violation, money back for consumers and the return of Meta’s profits from the ads.
It also asks the court to order Meta to tackle the scam ads it creates or delivers, and to appoint a monitor.
Meta has disputed the earlier Reuters reporting, calling it a selective view that distorts the company’s approach.
“We aggressively fight fraud and scams because people on our platforms don’t want this content,” spokesperson Andy Stone said at the time.
Meta has since pointed to progress on its anti-scam work. The state argues that scam ads remain widespread and easy to find in Meta’s own ad library.
The case adds to legal pressure on the company over fraud, as The Consumer Federation of America sued Meta in Washington, DC, over scam ads in April.