Meta Platforms has faced mounting scrutiny after internal documents revealed that Chinese advertisers defrauded millions of Facebook, Instagram and WhatsApp users worldwide, even as the company continued to profit from the activity.
$3 Billion in Fraudulent Ads Linked to China
Despite Beijing banning Meta’s platforms domestically, Chinese companies freely advertise to foreign users a lucrative business that generated over $18 billion in revenue for Meta in 2024, accounting for more than 10% of its global income. According to internal documents reviewed by Reuters, around 19% of that revenue roughly $3 billion came from scam ads, illegal gambling, pornography and other prohibited content.
The cache of documents, produced by Meta’s finance, lobbying, engineering and safety divisions, shows executives long understood the scale of abuse and the tension between cleaning up harmful content and protecting profits. Meta’s data indicated that China was responsible for nearly a quarter of all scam or banned ads globally, affecting victims from Taiwan to North America.
“We need to make significant investment to reduce growing harm,” staff warned in an April 2024 presentation. Meta formed a special anti-fraud task force, cutting illicit ads from China by half within six months until CEO Mark Zuckerberg reportedly intervened.
Following what documents described as an “Integrity Strategy pivot,” the team’s work was paused, the task force disbanded and restrictions on new Chinese ad agencies lifted. Within months, fraudulent ads surged again, reaching 16% of Meta’s China ad revenue by mid-2025.
Business Over Integrity
An outside consultancy, Propellerfish, warned Meta that its own policies fostered “systemic corruption” in the Chinese ad market. The report found that Meta’s partner system involving 11 top-tier Chinese ad resellers had created an opaque web of intermediaries that enabled scammers to evade detection.
Internal reports also revealed that Meta’s “whitelisting” process allowed suspect ads from major Chinese partners to remain online pending human review, often for days. “The added time for secondary review is adequate for scammers to accomplish their objectives,” one internal memo noted.
Even after identifying top Chinese advertisers repeatedly breaking its rules including Beijing Tengze Technology Co Ltd Meta continued doing business with them, imposing higher fees rather than termination. Staff later noted that halting such accounts would hurt revenue, with one remarking that enforcement must consider “the revenue impact.”
Meta’s Response and Fallout
Meta spokesperson Andy Stone told Reuters that the China-focused anti-fraud team was always intended as a temporary measure and denied that Zuckerberg ordered its shutdown. He said Meta has removed 46 million Chinese ads and penalised partners who ran too many violations.
“Scams are spiking across the internet,” Stone said, citing sophisticated criminal syndicates. “We are focused on rooting them out globally.”
However, the documents suggest Meta has tolerated persistent misconduct from Chinese advertisers, which internal teams dubbed the “Scam Exporting Nation.” Analysts noted that during China’s national holidays, global scam activity on Meta’s platforms noticeably declines evidence of how central China has become to the fraud ecosystem.
Federal prosecutors in the United States have already tied Chinese-linked ad campaigns to major financial crimes, including a $214 million stock fraud case. Lawmakers in Washington have urged regulators to investigate Meta’s handling of scam advertising, warning of potential consumer and investor harm.
Despite intermittent crackdowns, internal records from early 2025 show Meta ultimately chose to “maintain the percentage of global harm” caused by Chinese advertisers rather than eliminate it effectively accepting a base level of fraud as the cost of doing business.
(with inputs from Reuters)
