Meta faces scrutiny over Chinese scam ads as leaked documents detail billions in revenue and enforcement tensions

Meta, the parent company of Facebook and Instagram, is confronting fresh scrutiny after leaked internal documents described how Chinese scammers operated on its platforms while the company continued to profit from ads tied to illegal and deceptive activity. The documents, reviewed by Reuters, portray a complex tension between revenue goals and anti-fraud efforts, and they detail a trajectory of enforcement decisions that investigators say undermined potential scrubbing of scams.

In 2024, Meta earned more than $3 billion in China from scam advertisements, porn, illegal gambling and other shady sources, according to the leaked materials. That figure accounted for about 19% of Meta's total $18 billion advertising haul in China that year, Reuters reported. The numbers come as China bans its own citizens from using Facebook and Instagram, complicating the platform's ability to police activities from abroad. Meta has publicly asserted that it aimed to reduce high-risk harms, including fraud, across all markets, but the leaked documents suggest a more nuanced internal calculus.

Meta initially set up an anti-fraud team focused on China, according to the report. By the second half of 2024, the team had reduced revenue from Chinese scams to about 9%. Yet the anti-fraud unit was disbanded as part of an internal shakeup that included direct feedback from Mark Zuckerberg as part of an “Integrity Strategy pivot.” The documents do not specify the pivot’s nature, but they indicate that one late-2024 document said the China anti-fraud team was “asked to pause” its work “as a result of Integrity Strategy pivot and follow-up from Zuck.” In addition, Meta reportedly ended a freeze on bringing new Chinese ad agencies onto its platforms, a move that could widen the pool of advertisers involved in the market.

By mid-2025, the revenue from scam ads tied to China had rebounded to roughly 16% of Meta’s overall China ad revenue, according to the documents. At one point, Meta staffers contended that about a quarter of all scam ads on its platforms originated from Chinese sources—more than any other country—leading some internal notes to label China as the company’s top “scam exporting nation.” A May 2025 document cited a spike in fraudulent activity in ads bought by Chinese ad agencies, with reported violations including deceptive business practices and marketing for sex content, weapons and even animal abuse.

In 2024 alone, Meta’s reported earnings from scam-related activity—though not exclusively limited to scams—exceeded $3 billion, the documents show, reinforcing a finding that the North Asian market contributed heavily to illicit ad revenue. Within the notes, a staffer asked whether the company should take action against advertisers in Meta’s partner program, given the breadth of the suspicious activity. Another staffer responded that taking action could have an outsized revenue impact, arguing the company should refrain from penalties in some cases.

Meta spokesman Andy Stone has pushed back on the portrayal that Zuckerberg steered enforcement away from China. He said the China-focused anti-fraud team was always treated as temporary and that Zuckerberg’s guidance to teams addressing high-risk harms, including fraud and scams, was to “redouble efforts to reduce them all across the globe, including in China.” Stone emphasized that the company has taken action, noting Meta has rejected or removed 245 million ads that violated its fraud policies over the last 18 months. He added that “scams are spiking across the internet” and that Meta is pursuing “advanced technical measures,” new tools, industry partnerships and law-enforcement cooperation to disrupt criminal networks and raise awareness on its platforms.

The document cascade also drew on independent analyses. A Meta-commissioned study by London firm Propellerfish found that enforcement of China-based violations was “inconsistent” compared with rivals like TikTok and Google, suggesting the company’s own rules and policies may have, at times, allowed bad actors to operate more aggressively in China. Separately, The Post reported that Facebook accounts for the vast majority of scams on social media, citing fraud-reporting data from SafelyHQ. The data indicate that fraud reports frequently identify Facebook as the platform where victims were scammed, with the company cited in about 85% of such cases.

Reuters has previously reported that Meta anticipated earning about $16 billion from scam ads, or roughly 10% of its China revenue, based on internal documents. Those disclosures also indicated that the company bans accounts only if its systems determine there is at least a 95% chance that the accounts are committing fraud, a threshold that critics have described as steep yet not uncommon among major platforms’ enforcement criteria.

The saga has drawn the attention of U.S. lawmakers. Senators Josh Hawley, a Missouri Republican, and Richard Blumenthal, a Connecticut Democrat, have pressed for a federal investigation into Meta’s handling of scam ads, arguing that the company’s practices potentially harm users and distort online advertising markets. The exchange underscores broader political scrutiny of how major tech platforms police abuse, fraud and other high-risk harms in fast-growing regions.

Meta contends that its enforcement approach is evolving and that dangerous actors repeatedly adapt their strategies. The company says it will continue to invest in detection technologies, risk scoring, and partnerships with industry and law enforcement to disrupt scam networks. Critics argue that even if enforcement is growing more sophisticated, the financial incentives created by high ad-revenue potential in markets like China may deter aggressive action against bad actors.

As the debate continues, observers say the episode underscores a broader challenge for technology platforms operating internationally: balancing revenue growth with aggressive, credible anti-fraud measures in environments where jurisdictional complexities and profit pressures intersect with rapid, scalable misuse of platforms.