Bipartisan SCAM Act would require online platforms to crack down on fraudulent ads

A new bipartisan bill aims to hold social media platforms accountable for scam ads profiting them. Senators Gallego and Moreno introduced the Safeguarding Consumers from Advertising Misconduct (SCAM) Act, mandating platforms prevent fraudulent ads. Platforms face civil legal action from the FTC and state attorneys general if they fail to comply. A Reuters report revealed Meta potentially earned billions from scam ads. Meta reportedly allowed small fraudsters to operate until ads were flagged multiple times. Executives wrestled with controlling scams without impacting profits, prioritizing revenue. The FTC estimates Americans lost nearly $19 billion to fraud in 2024. The SCAM Act aims to protect consumers' money online by holding companies responsible. Senators Gallego and Moreno believe the bill is critical to protect consumers. The bill seeks to address how social media companies knowingly enable financially harmful scams.