Meta Sued Again Over Alleged Crypto Scam Ad Facilitation
Meta is facing another lawsuit over cryptocurrency scams on its platforms. Three users who claim they lost money to scammers allege that Facebook and Instagram ads led them to WhatsApp groups where they encountered fraudulent schemes.
The plaintiffs, Niroshini Dassanayake, Kenneth Gugel, and Andrew Svoboda, say Meta's generative artificial intelligence tools enhanced the effectiveness of these scam ads by generating hundreds of variations optimized for engagement with vulnerable users.
Meta has faced similar lawsuits before, including one last year that also alleged scammers used its AI tools to create ads. In this case, a district court judge rejected Meta's bid for dismissal under Section 230 of the Communications Decency Act, which generally immunizes companies from liability for illegal activity by advertisers and third parties.
The plaintiffs claim Meta knows or should know that its AI tools contribute to the creation and optimization of false and deceptive advertisements, steering them to target vulnerable consumers. They also allege that Meta's business practices deceptively lead reasonable consumers to believe it removes fraudulent ads from its platforms.