Attorney General Bonta Urges Immediate Action by Meta to Prevent Investment Scam Advertisements on its Platforms

Meta must do better to protect consumers from financial harm 

OAKLAND — California Attorney General Rob Bonta, as part of a bipartisan coalition of 42 attorneys general, today sent a letter to Meta expressing deep concern regarding a flurry of investment scam advertisements (ads) running on its platforms — including Facebook newsfeeds. These investment scam ads threaten the pockets of consumers nationwide and Meta's existing systems have been shown to be insufficient to address the problem. In response to this concerning trend, the attorneys general ask Meta to take immediate action to improve its capabilities to detect and respond to these ads.

“It’s alarming to see how easy investment scam ads — which have cost some consumers their life savings — can be created and disseminated on Meta platforms. This growing trend, combined with Meta’s inadequate method of identifying these ads and its significant delay in removing them, makes this a recipe for disaster,” said Attorney General Bonta. “Today, I urge Meta to prioritize the safety of its users against investment scam ads — Meta can and must do right by the millions of people that use its platforms.” 

Investment scam ads running on Meta's platforms deceive consumers with images of well-known investors. Upon clicking on the ads, users are prompted to download WhatsApp and become members of groups that are not in fact sponsored or affiliated with the investors identified in the ads.  They are then targeted in an illegal investment scheme, commonly known as a “pump and dump” scheme. As part of the scheme, scammers encourage users to invest in penny stocks, thus inflating or pumping up the stock price. Then the scammers quickly sell the stocks — leaving the users holding worthless stock that they can no longer sell to recover their losses. In some cases, these scams have resulted in users losing their life savings. The impact on victims is devastating, leading not only immense financial losses, but also significant psychological and social consequences. 

In the letter, the attorneys general urge Meta to adopt protocols to properly tackle this pervasive issue — or otherwise ban all investment ads on its platforms. Although Meta uses a combination of automated systems and occasional human review to try to detect, block, and remove these advertisements, these systems do not work and allow vast numbers of scam ads to get through to publication.  

The letter sent today highlights the latest way Meta fails to protect its users against harmful content. In 2023, Attorney General Bonta, along with a bipartisan coalition of attorneys general, sued Meta for its role in designing and deploying harmful features on Instagram and Facebook that addict children and teens to their mental and physical detriment. This lawsuit remains ongoing. Last year, Attorney General Bonta sent a letter to Meta expressing concern regarding the increase in account takeovers and lockouts on Facebook and Instagram and the inadequacy of the company’s response to prevent and address consumer harm from these takeovers.  

In sending today’s letter to Meta, Attorney General Bonta joins the attorneys general of Connecticut, New Hampshire, New York, Pennsylvania, Alaska, Arizona, Arkansas, Colorado, Delaware, Georgia, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Carolina, South Dakota, Utah, Vermont, Virginia, Washinton, West Virginia, Wyoming, the District of Columbia, American Samoa, and the U.S. Virgin Islands. 

A copy of the letter can be found here.