Social media behemoth Meta Platforms Inc. reportedly generated billions of dollars in annual revenue from Chinese advertisers who were running scams and illegal content on its platforms, with internal company documents revealing the firm was aware of the widespread fraud. According to a Reuters investigation based on internal Meta documents, the company calculated that it earned over $3 billion in annual revenues in China through advertising tied to fraudulent schemes and other banned material.
The Scale of the Problem: Billions from Banned Content
Despite a comprehensive ban on Meta's platforms—Facebook, Instagram, and WhatsApp—for ordinary citizens in China, the country permits its businesses to use these networks for global marketing. This loophole created a massive revenue stream, but one riddled with abuse. The internal assessment reportedly found that roughly 19% of Meta's 2024 China ad revenue, which totalled over $18 billion and constituted more than 10% of global revenue, was linked to ads for scams, illegal gambling, pornography, and other prohibited content.
Meta's analysis indicated that nearly a quarter of all ads shown on its platforms worldwide originated from China. The victims of these deceptive advertisements were global, including Taiwanese shoppers misled by fake health products and investors in the United States and Canada who lost their life savings.
Internal Alarm and a Short-Lived Crackdown
By April 2024, the issue had escalated enough for it to be raised in an internal staff meeting with Meta's management. The message was clear: "We need to make a big investment to reduce growing harm." In response, Meta formed a dedicated 'special team' to combat this specific fraud. The effort appeared successful; by the end of 2024, the team had managed to cut the share of 'problematic' Chinese ads by almost half, reducing it from 19% to just 9% of overall China ad revenue.
However, the crackdown was short-lived. Following input from CEO Mark Zuckerberg, the China ads-enforcement team was "asked to pause" its work. Subsequently, the anti-scam squad was dissolved, and other related initiatives were put on hold or abandoned, as per the internal documents. The consequence was predictable: the percentage of banned ads climbed back to approximately 16% of Meta's China revenue by mid-2025.
Meta's Response and Ongoing Scrutiny
Reacting to the report, Meta spokesperson Andy Stone stated that the special team focused on Chinese fraud was always intended to be temporary. He clarified that Zuckerberg did not direct the team's dissolution but instead instructed teams to "redouble efforts" to reduce scams globally, including in China. Stone outlined Meta's enforcement actions, noting that automated systems had blocked or removed 46 million ads from Chinese partners in 18 months, often before user viewing.
"Scams are spiking across the internet, driven by persistent criminals and sophisticated, organized crime syndicates constantly evolving their schemes to evade detection," Stone said. He added that Meta terminates relationships with agencies for misconduct and reduces commissions for partners that repeatedly violate policies.
The revelations have intensified scrutiny on Meta's advertising practices, particularly concerning its lucrative China operations. Following earlier Reuters reporting that Meta makes nearly $7 billion yearly from high-risk scam ads, two US senators requested investigations by the SEC and FTC. The internal documents consistently identify China as the leading source of scam content on Meta's platforms, highlighting a stark tension between user safety and corporate revenue.
Former Facebook senior director of product management, Rob Leathern, commented on the scale revealed, stating, "The levels that you’re talking about are not defensible. I don’t know how anyone could think this is okay."
