FTC Issues Orders to Social Media and Video Streaming Platforms Regarding Efforts to Address Surge in Advertising for Fraudulent Products and Scams
With fraud on social media surging, the Federal Trade Commission (FTC) has issued orders to eight social media and video streaming platforms seeking 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. In 2022 alone, consumers reported losing more than $1.2 billion to fraud that started on social media, more than any other contact method, according to FTC data. The FTC is also seeking information about how social media and video streaming companies ensure that consumers are able to identify commercial advertising on their platforms as advertising. The orders, which 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. The orders will collect information about the companies’ standards and policies related to paid commercial ads and their processes for screening and monitoring for compliance with those standards and policies, including through human review and the use of automated systems. The orders also require the companies to report their ad revenue, the number of ad views, and other performance metrics, including for ads involving categories of products and services more prone to deception such as those intended to treat, prevent, or cure substance use disorders and tout income opportunities.
FTC Issues Orders Regarding Efforts to Address Surge in Advertising for Fraudulent Products and Scams