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Meta created 'playbook' to fend off pressure to crack down on scammers, documents show
Japanese regulators last year were upset by a flood of ads for obvious scams on Facebook and Instagram. The scams ranged from fraudulent investment schemes to fake celebrity product endorsements created by artificial intelligence.
Meta, owner of the two social media platforms, feared Japan would soon force it to verify the identity of all its advertisers, internal documents reviewed by Reuters show. The step would likely reduce fraud but also cost the company revenue.
To head off that threat, Meta launched an enforcement blitz to reduce the volume of offending ads. But it also sought to make problematic ads less "discoverable" for Japanese regulators, the documents show.
The documents are part of an internal cache of materials from the past four years in which Meta employees assessed the fast-growing level of fraudulent advertising across its platforms worldwide. Drawn from multiple sources and authored by employees in departments including finance, legal, public policy and safety, the documents also reveal ways that Meta, to protect billions of dollars in ad revenue, has resisted efforts by governments to crack down.
In this case, Meta's remedy hinged on its "Ad Library," a publicly searchable database where users can look up Facebook and Instagram ads using keywords. Meta built the library as a transparency tool, and the company realized Japanese regulators were searching it as a "simple test" of "Meta's effectiveness at tackling scams," one document noted.
To perform better on that test, Meta staffers found a way to manage what they called the "prevalence perception" of scam ads returned by Ad Library searches, the documents show. First, they identified the top keywords and celebrity names that Japanese Ad Library users employed to find the fraud ads. Then they ran identical searches repeatedly, deleting ads that appeared fraudulent from the library and Meta's platforms.
The tactic successfully removed some fraudulent advertising of the sort that regulators would want to weed out. But it also served to make the search results that Meta believed regulators were viewing appear cleaner than they otherwise would have. The scrubbing, Meta teams explained in documents regarding their efforts to reduce scam discoverability, sought to make problematic content "not findable" for "regulators, investigators and journalists."
Within a few months, they said in one memo after the effort, "we discovered less than 100 ads in the last week, hitting 0 for the last 4 days of the sprint." The Japanese government also took note, the document added, citing an interview in which a prominent legislator lauded the improvement.
"Fraudulent ads are already decreasing," Takayuki Kobayashi, of the ruling Liberal Democratic Party, told a local media outlet. Kobayashi didn't respond to a Reuters request for comment about the interview.
Japan didn't mandate the verification and transparency rules Meta feared. The country's
Ministry of Internal Affairs and Communications declined to comment.
So successful was the search-result cleanup that Meta, the documents show, added the tactic to a "general global playbook" it has deployed against regulatory scrutiny in other markets, including the United States, Europe, India, Australia, Brazil and Thailand. The playbook, as it's referred to in some of the documents, lays out Meta's strategy to stall regulators and put off advertiser verification unless new laws leave them no choice.
The search scrubbing, said Sandeep Abraham, a former Meta fraud investigator who now co-runs a cybersecurity consultancy called Risky Business Solutions, amounts to "regulatory theater," distorting the very transparency the Ad Library purports to provide. "Instead of telling me an accurate story about ads on Meta's platforms, it now just tells me a story about Meta trying to give itself a good grade for regulators," said Abraham, who left the company in 2023.
Meta spokesperson Andy Stone in a statement told Reuters there is nothing misleading about removing scam ads from the library. "To suggest otherwise is disingenuous," Stone said.
By cleaning those ads from search results, the company is also removing them from its systems overall. "Meta teams regularly check the Ad Library to identify scam ads because when fewer scam ads show up there that means there are fewer scam ads on the platform," Stone wrote.
Advertiser verification, he said, is only one among many measures the company uses to prevent scams. Verification is "not a silver bullet," Stone wrote, adding that it "works best in concert with other, higher-impact tools." He disputed that Meta has sought to stall or weaken regulations, and said that the company's work with regulators is just part of its broader efforts to reduce scams.
Those efforts, Stone continued, have been successful, particularly considering the continuous maneuvers by scammers to get around measures to block them. "The job of chasing them down never ends," he wrote. The company has set global scam reduction targets, Stone said, and in the past year has seen a 50% decline in user reports of scams. "We set a global baseline and aggressive targets to drive down scam activity in countries where it was greatest, all of which has led to an overall reduction in scams on platform."
Meta's internal documents cast new light on the central role played by fraudulent advertising in the social media giant's business model - and the steps the company takes to safeguard that revenue. Reuters reported in November that scam ads Meta considers "high risk" generate as much as $7 billion in revenue for the company each year. This month, the news agency found that Meta tolerates rampant fraud from advertisers in China.
In response to Reuters' coverage, two U.S. senators urged regulators at the Securities and Exchange Commission and the Federal Trade Commission to investigate and "pursue vigorous enforcement action where appropriate." Citing Reuters reporting, the attorney general of the U.S. Virgin Islands also sued Meta this month for allegedly "knowingly and intentionally" exposing users of its platforms to "fraud and harm" and "profiting from scams." Stone said Meta strongly disagrees with the lawsuit's allegations.
In Brussels, where European authorities have also been focused on scams, a spokesperson for the European Commission told Reuters its regulators had recently asked Meta for details about its handling of fraudulent advertising. "The Commission has sent a formal request for information to Meta relating to scam ads and risks related to scam ads and how Meta manages these risks," spokesperson Thomas Regnier wrote. "There are doubts about compliance." He didn't elaborate.
The documents reviewed by Reuters show that Meta assigned its handling of scams the top possible score in an internal ranking of regulatory, legal, reputational and financial risks in 2025. One internal analysis calculated that possible regulation in Europe and Britain that would make Meta liable for its users' scam losses could cost the company as much as $9.3 billion.
Employ a "reactive only" stance
One big push among regulators is to get Meta and other social media companies to adopt what is known as universal advertiser verification. The step requires all advertisers to pass an identity check by social media platforms before the platforms will accep
t their ads. Often, regulators request that some of an advertiser's identity information also be viewable, allowing users to see whether an ad was posted locally or from the other side of the world.
Google in 2020 announced that it would gradually adopt universal verification, and said earlier this year it has now verified more than 90% of advertisers. Along with requiring verification in jurisdictions where it's legally mandated, Meta offers to voluntarily verify some large advertisers and sells "Meta Verified" badges to others, combining identity checks with access to customer support staff.
Documents reviewed by Reuters say that 55% of Meta's advertising revenue came from verified sources last year. Stone, the spokesperson, added that 70% of the company's revenue now comes from advertisers it considers verified.
The internal company documents show that unverified advertisers are disproportionately responsible for harm on Meta's platforms. One analysis from 2022 found that 70% of its newly active advertisers were promoting scams, illicit goods or "low quality" products.
Stone said that Meta routinely disables such new accounts, "some on the very day that they're created."
Meta's documents also show the company recognizes that universal verification would reduce scam activity. They indicate that Meta could implement the measure in any of the countries where it operates in less than six weeks, should it choose to do so.
But Meta has balked at the cost.
Despite reaping revenue of $164.5 billion last year, almost all of which came from advertising, Meta has decided not to spend the roughly $2 billion it estimates universal verification would cost, the documents show. In addition to that cost of implementation, staffers noted, Meta could ultimately lose up to 4.8% of its total revenue by blocking unverified advertisers.
Instead of adopting verification, Meta has decided to employ a "reactive only" stance, according to the documents. That means resisting efforts at regulation - through lobbying but also through measures like the scrubbing of Ad Library searches in Japan last year. The reactive stance also means accepting universal verification only if lawmakers mandate it.
So far, just a few markets, including Taiwan and Singapore, have done so.
Even then, the documents show, the financial costs to Meta have remained small. Meta's own tests showed verification immediately reduced scam ads in those countries by as much as 29%. But much of the lost revenue was recouped because the same blocked ads continued to run in other markets.
If an unverified advertiser is blocked from showing ads in Taiwan, for example, Meta will show those ads more frequently to users elsewhere, creating a whack-a-mole dynamic in which scam ads prohibited in one jurisdiction pop up in another. In the case of blocked ads in Taiwan, "revenue was redistributed/rerouted to the remaining target countries," one March 2025 document said, adding that consumer injury gets displaced, too. "This would go for harm as well," the document noted.
Meta's documents show the company believes its efforts to defeat regulation are succeeding. In mid-2024, one strategy document called the prospect of being "required to verify all advertisers" worldwide a "black swan," a term used to describe an improbable but catastrophic event. In the months afterwards, policy staffers boasted about stalling regulations in Europe, Singapore, Britain and elsewhere.
In July, one Meta lobbyist wrote colleagues after they thwarted stricter measures considered by financial regulators in Hong Kong against financial scams. To get ahead of the effort, staffers helped regulators draft a voluntary "anti-scam charter." They coordinated with Google, which also signed the charter, to present a "united front," the document says. "Through skillful negotiations with regulators," the Meta lobbyist wrote, Hong Kong relaxed rules that would have forced verification of financial advertisers. "The finalised language does not introduce new commitments or require additional product development."
Hong Kong regulators, the lobbyist added, "have shown huge appreciation for Meta's leading participation."
A Google spokesperson said the company signed onto the charter because it believed it would benefit customers. Google participated, he said, of its own accord and as the result of direct engagement with Hong Kong regulators.
In a statement, Hong Kong financial regulators said that "advertiser verification is one of many ways social media platforms can protect the investment public." They declined to respond to Reuters' questions about Meta and noted that the regulators involved with the charter don't themselves have the authority to impose advertiser verification requirements.
"All social media platforms should strengthen their efforts to detect and remove fraudulent and unlawful materials," they added.
"Industry and regulatory expectations"
Fraud across social media platforms has surged in recent years, fueled by the rise of untraceable cryptocurrency payments, AI ad-generation tools and organized crime syndicates. Mob rings have found the business so lucrative that they employ forced labor to staff well-documented "scam compounds" that generate waves of fraudulent content from southeast Asia. Internally, Meta has cited estimates that such compounds are responsible for $63 billion in annual damage to consumers worldwide.
In some countries, regulators have determined that Meta platforms host more fraudulent content than its online competitors. In February 2024, Singapore police reported that more than 90% of social media fraud victims in the city state had been scammed through Facebook or Instagram
. In a statement to Reuters, a spokesperson for Singapore's Ministry of Home Affairs wrote that "Meta products have persistently been the most common platforms used by scammers."
"We have repeatedly highlighted our deep concern over the continued prevalence of scams on Meta's platforms," the statement continued. After Reuters' inquiries for this report, it added, Singapore authorities have asked Meta for more information and will broaden existing verification measures, including some mandating the use of facial recognition technology to prevent the impersonation of public figures. "We have reiterated that more needs to be done to secure Meta's products and protect users from scams, instead of prioritising its profits. We have requested for a formal explanation from Meta and will take enforcement action if Meta is found to be in violation of legal requirements."
A known weakness in Meta's defenses is the ease of advertising on its platforms.
To purchase most advertisements, all a client needs is a user account - easily created with an email or phone number and a user-supplied name and birthdate. If Meta doesn't verify those details, it can't know who it's doing business with. Even if an advertiser gets banned, there is nothing to stop it from returning with a new account. A fraudster can merely sign up again.
Meta has known about the problem for years, documents and interviews with former staffers show.
In the 2016 U.S. presidential election, fake political ads flooded Facebook with disinformation. In response, the company took steps to reduce chances that could happen again. Back then, foreign actors seeking to influence the election easily placed ads masquerading as Americans. Some Russian advertisers pretending to be American political activists even paid for such ads in rubles, Meta has said.
Starting in 2018, the company began requiring a valid identity document and a confirmed U.S. address before clients could place political ads. In addition to providing verification for the company itself, the general details, including the name and location of the advertiser, could be viewed by users, too.
Rob Leathern, a former senior director of product management at Facebook who oversaw the effort to verify political advertisers, said the added transparency and accountability led some staffers to believe that Meta would broaden it to all advertisers. "I expected that the company would have continued to do more verification, and personally felt that was something that all major platforms should be doing," said Leathern, who left the company at the end of 2020.
Meta in 2018 also introduced its Ad Library, an easily searchable database of all ads that run on its platforms. The company, the documents show, expected to generate goodwill with the library, particularly with regards to political advertisements. Competitors, including Google, soon launched ad libraries of their own.
In the years that followed, Meta continued to acknowledge the effectiveness of both transparency and verification. So-called "know your customer policies," Meta staffers wrote in a November 2024 document, are "commonly understood to be effective at reducing scam-risks." They noted a competitive component, too, citing Google's move at the start of the decade to adopt universal verification: "Google's approach to verify all advertisers is recalibrating industry and regulatory expectations."
Meta, however, has been reluctant to pay for it.
The internal documents show that last year Meta consulted with a company that works with Google to verify advertisers. Meta officials, according to the documents, wanted to know how much it would cost to follow suit. But the answer - at least $20 per advertiser - proved too costly for their liking, one document said.
The Meta spokesperson said that the company, regardless of cost, didn't work with the vendor because its verification process took too long.
The potential for lost revenue has also given the company pause.
In addition to lost income from advertisers culled by verification, stricter measures could also cannibalize a paid program through which Meta already charges advertisers for similar status. The program, known as "Verified for Business," costs clients as much as $349.99 per month and allows businesses to display a badge assuring users that Meta has authenticated their profile. Meta describes the program as more than just basic verification, offering advertisers better customer support and protections against impersonation.
Still, the documents show, Meta managers fear those revenues could shrivel if the company adopts verification for all advertisers.
"We have an opportunity"
In 2023, because of a sharp rise in ads for investment scams, Taiwan passed legislation ordering social media platforms to begin verifying advertisers of financial products. The self-governing island, population 23 millio
n, is small compared to Meta's major markets, but the company's response there helps illustrate how resistant Meta has been to growing regulatory scrutiny worldwide.
In private conversations, the documents show, Taiwanese regulators told Meta it needed to demonstrate it was taking concrete steps to help reduce financial scam ads. When it came to financial fraud, the regulators said, Meta needed to verify the identity of those advertising financial services and respond to reports of fraud within 24 hours.
Meta, according to the documents, told Taiwan it needed more time to comply. Regulators agreed. But Meta, the documents show, in the months that followed didn't address the problem to the government's satisfaction.
Frustrated, the Taiwanese regulators last year issued new demands. Now, the new regulations stated, Meta and the owners of other major platforms would have to verify all advertisers. Regulators told Meta it would be fined $180,000 for every unverified scam ad it ran, Meta staffers wrote.
If it didn't comply, the staffers calculated, the resulting fines would exceed Meta's total profits in Taiwan. It would be cheaper to abandon the market than to disobey, they concluded.
Meta complied, rushing to verify advertisers ahead of regulators' deadlines.
In a statement to Reuters, Taiwan's Ministry of Digital Affairs said stricter regulations over the past year brought down rates of scam ads involving investments by 96% and identity impersonation by 94%. In addition to requiring major social media platforms to verify advertisers, Taiwan has developed its own AI system to scan ads on Meta's platform, set up a portal for citizens to report fraudulent ads, and established public-private partnerships to detect scams, the ministry added.
Over the course of 2025, the statement said, Taiwan has fined Meta about $590,000 for four violations of the law. The ministry said it "will maintain a close watch on shifting fraud risks." The new rules gave Meta the opportunity to study the impact that full verification would have on its business. Before the new regulation, according to internal calculations, about 18% of all Meta advertising in Taiwan, or about $342 million of its annual ad business there, broke at least one of the company's rules against false advertising or the sale of banned products. Unverified advertisers, one analysis found, produced twice as much problematic advertising as those who submitted verification details.
Their analyses also revealed the whack-a-mole dynamic.
Because scamming is a global business - and Meta's algorithms allow clients to choose multiple markets in which to advertise - many advertisers seeking to place fraudulent posts do so in more than one geography. Meta experiments showed that while fraudulent ads decreased in Taiwan after the rule change, its algorithms simply rerouted them to users in other markets.
"The implication here is that violating actors that only require verification in one country, will shift their harm to other countries," one analysis spelled out. Unless advertiser verification was "enforced globally," staffers wrote, Meta wouldn't so much be fighting scams as relocating them.
The documents included briefing notes prepared for Chief Executive Mark Zuckerberg about the dynamic. Reuters couldn't determine whether the Meta boss ever saw the notes or was briefed on their contents. But the message delivered a similar conclusion. It also warned of a complication: If enforcement in one jurisdiction worsened the problem of fraud in others, regulators in the newly impacted markets were likely to crack down, too.
Meta spokesperson Stone said he couldn't determine whether Zuckerberg received the briefing described in the document reviewed by Reuters.
Faced with the prospect of ever-expanding scrutiny, Meta considered embracing full verification voluntarily, the documents show. The goal, staffers wrote, could enable the company to appear proactive but also set terms and a timeline on its own. "We have an opportunity to set a goal of verifying all advertisers (and communicate our intention to do so externally, in order to better negotiate with lawmakers)," a November 2024 strategy document noted. Meta could "stage the rollout over time and set our own definitions of verification."
Policy staff even planned to announce the decision during the first half of 2025, the documents show. But for reasons not specified in the documents, they postponed an announcement until the second half of the year and then cancelled it altogether. Leadership had changed its mind, a document noted, without saying why.
"Mimic what regulators may search for"
Instead, Meta began to apply some of the lessons it learned in Japan.
That experience helped the company realize that Tokyo wasn't the only government using Ad Library searches as a means of tracking online fraud. "Regulators will open up the ads library and show us multiple similar scam ads," public policy staffers lamented in one 2024 document. Staffers also noted authorities were employing one feature that was proving especially useful: a keyword search. Unlike Google's version, the Meta library made it easy to find scam ads through searches with terms like "free gift" or "guaranteed profit."
Managers overseeing a revamp of the Ad Library proposed eventually killing the keyword feature entirely, the documents show. Wary of blowback from regulators, however, Meta decided not to. The Meta spokesperson said Meta is not considering it.
The company did, however, change the library so that searches returned fewer objectionable ads.
One adjustment made searches default to active ads, reducing the number of search results by eliminating content that Meta had already blocked through prior screening. The change made fraudulent ads from the past absent from new search results.
Staffers also made Meta's systems rerun enforcement measures on all ads that appeared during new Ad Library searches, the documents show. That adjustment gave Meta a second chance to scrap violators that had previously evaded fraud filters.
One of the most useful tactics it learned in Japan was Meta's mimicry of searches performed by regulators. After repeating the same queries, and deleting problematic results, staffers could eventually go days without finding scam ads, one document shows.
As a result, Meta decided to take the tactic global, performing similar analyses to assess "scam discoverability" in other countries. "We have built a vast keyword list by country that is meant to mimic what regulators may search for," one document states. Another described the work as changing the "prevalence perception" of scams on Facebook and Instagram.
Meta's perception-management tools are now part of what the company has referred to as its "general global playbook" for dealing with regulators. The documents reviewed by Reuters repeatedly reference the "playbook" as steps the company should follow in order to slow the push toward verification in any given jurisdiction.
Beginning one year ahead of expected regulation, the playbook advises, Meta should tell the local regulators it will create a voluntary verification process. When doing so, the documents add, Meta should ask those authorities for time to let the voluntary measures play out. To buy yet more time, and further gauge reactions from regulators, Meta after six months should force verification upon "new and risky" advertisers, the playbook continues.
If ultimately regulators force mandatory verification for all, the playbook states, Meta should once again stall. "Keep engaging with regulator on extension," one document advises.
The documents show Meta staffers celebrating the success of their efforts to change some perceptions.
In March, industry officials and regulators met for a conference in London organized by the Global Anti-Scam Alliance, a group that organizes regular gatherings to address online fraud. Meta staffers in one document celebrated the lack of scorn heaped on the company compared with previous events.
"There was a drastic shift in tone," a project manager noted. "Meta was rarely called out whereas previously we were explicitly and repeatedly shamed for lack of action in countering fraud."
Source: EconomicTimes
Related Posts: meta,stone,meta ad scams,facebook instagram ad scams,Meta ads antitrust,google,taiwan,risky business solutions,securities and exchange commission,u.s. virgin islands
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