State AGs led by NY's Letitia James pressure Meta to clean up investment scams on Facebook
A group of 42 state attorneys general are calling on Meta to curb the rise of investment scams on Facebook that fraudulently use the images of Warren Buffett and other famous figures, New York Attorney General Letitia James said Wednesday.
James said in a news release criminals are consistently evading Meta's automated and human review systems to post fake ads that leave retail investors saddled with millions of dollars in losses. Her office continues to see the scams months after reporting them to Meta, she added.
The ads, touting access to Buffett, Elon Musk or Ark Invest's Cathie Wood, lure Facebook users to join chat groups on Meta-owned messaging platform, WhatsApp, according to the New York AG.
There, users are unwittingly involved in alleged pump-and-dump schemes, where criminals boost the price of thinly traded stocks and quickly sell for a profit, leaving small investors with losses.
Meta, the parent company of Facebook, Instagram and WhatsApp, is struggling to control the rise of cyber scams on its platforms and is a "cornerstone of the internet fraud economy," the Wall Street Journal reported last month. The problem is global in nature, with one notable lawsuit being brought by an Australian billionaire who alleges that Meta's artificial intelligence-run advertising program created and amplified false ads using his likeness.
"Thousands of Facebook users have lost hundreds of millions of dollars to these scams and Meta must do more to stop these fraudulent ads from running on its platforms," James said. "I am leading a bipartisan coalition calling on Meta to step up its review of ads to stop these scams. I also urge all New Yorkers to be extra careful before putting their money in investments they see advertised on social media."
The AGs urged Meta to boost its policing of ads, including with more human review, saying that unless they curb the scams, Meta should stop running investment ads altogether.
Joining James were AGs from states including California, Connecticut, Georgia, Massachusetts, Michigan, New Jersey and Pennsylvania.
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