(AsiaGameHub) –   Meta, the parent firm behind Facebook and Instagram, is facing a lawsuit filed by the Consumer Federation of America (CFA) at the Superior Court of the District of Columbia. The CFA alleges that the social media conglomerate has generated revenue from advertisements promoting fraudulent activities, including fake gambling platforms, and has deceived users about its efforts to address the problem.

Meta Faces Allegations of Facilitating Illegal Gambling and Fraud Schemes

Per the CFA, Meta has put in place policies and operational practices that intentionally allow scam advertisements to circulate across its platforms, while simultaneously profiting from these ads at the cost of its users. The group also accuses Meta of downplaying how widespread fraud is on its apps, which creates a “false impression of safety” for users.

Ben Winters, the director of AI and data privacy at the CFA, noted that as Americans continue to lose increasing amounts of money to online scams, Meta has consistently put profit ahead of user safety. The CFA argues that Meta’s conduct violates a consumer protection statute in Washington, D.C.

The organization claims that by tricking users into gambling on these unregulated websites and apps, Meta is complicit in the fraud and acts as a “pillar” of the “global fraud economy.” The nonprofit is seeking damages, as well as the return of what it alleges are illegal profits the tech giant earned from running these fraudulent ads.

This is not the first time Meta has faced public criticism for allegedly enabling illegal gambling ads and scam websites on its platforms. For example, just a few months ago, the UK Gambling Commission rebuked Meta for apparently attempting to maintain connections with the legal gaming industry, even as it allowed advertisers to promote unlicensed operators.

Meta Addresses the Allegations

In reaction to the CFA’s legal action, Meta stated that the claims misrepresent the actual nature of its anti-fraud work and that it plans to contest them. The company also referenced a recent announcement where it noted it had scaled up its advertiser verification efforts and started banning financial services-related ads from redirecting users to private messaging services, a tactic regularly used by financial scammers.

A Meta spokesperson further shared that, in the last year alone, the company removed more than 159 million scam ads, 92% of which were taken down before any user filed a report. In addition, it deleted 10.9 million Facebook and Instagram accounts connected to criminal scam operations. The company added that it continues to invest in new technologies to crack down on securities investment scams and other forms of online fraud.

These reassurances do not appear to be enough for the CFA, however, as the organization is putting forward a class-action lawsuit covering Meta users based in Washington, D.C., and is requesting a jury trial for the case.