FTC Calls Social Media A “GoldMine For Scammers”

The FTC believes that Social Media has been a goldmine for scammers, and now they are taking action.

In a sweeping order issued this week, the FTC requested information on how these companies scrutinize and restrict paid commercial advertising that is deceptive or exposes consumers to fraudulent healthcare products, financial scams, counterfeit and fake goods, or other fraud.

The Order Was Sent to 8 Of The Largest Companies

The orderswhich the companies are required to comply with by law, were sent to: Meta Platforms, Inc.; Instagram, LLC; YouTube, LLC; TikTok, Inc.; Snap, Inc.; Twitter, Inc.; Pinterest, Inc.; and Twitch Interactive, Inc.

“Social media has been a gold mine for scammers who tout sham products and other scams that have cost consumers enormously in recent years,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “This study will help the FTC ensure that social media and video streaming companies do everything they can to keep scammers and deceptive ads off their platforms.”

This Is Not A Small Request By The FTC And Goes Back 4 Years

This order will be a fairly large effort for Social Media companies to complete. The 33-page order will require the companies to reveal basically every facet of their advertising program – not a small task.

And the order goes back from 2019 through 2023, which allows the FTC to study relevant business conduct since the start of the COVID-19 pandemic.

The data that they send to the FTC will help the FTC understand how prevalent deceptive advertising is on social media and video streaming platforms, the consumers who that advertising may harm, and the effectiveness of the platforms’ oversight of advertisers, including whether the companies treat English-language and Spanish-language ads differently.

Read The Whole Report Here