Rhode Island Attorney General Peter Neronha has filed a lawsuit against Meta and Instagram in Providence Superior Court under the state's Deceptive Trade Practices Act. The suit alleges that Meta profited from scam ads on its platforms and cites Reuters reporting of roughly 15 billion higher-risk ads a day and revenue equal to about 10% of 2024 sales. It seeks penalties, restitution for victims, disgorgement of profits and an injunction. Meta calls the lawsuit unfounded.

What it means: The lawsuit is part of a wave of action in the US and Europe aimed at shifting some of the responsibility for online scams from victims and banks to the platforms that host and are paid for the ads. Until now US platforms have been largely shielded from liability for third-party content, but this suit focuses on their own business practices and advertising revenue. In the EU, the Digital Services Act already requires very large platforms to assess and limit such risks, and the Commission has just published a study on financial scams. For Greece, where fake investment ads and fake online shops are common, the outcome of such cases matters to banks, payment providers and consumers. If platforms are forced to vet advertisers more strictly, legitimate Greek businesses advertising on Facebook and Instagram may face more identity checks and slower campaign approvals. On the other hand, fewer fake ads mean fewer customers being cheated in the name of real businesses. The case is at an early stage and a ruling will take time.

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