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FTC slams social media sites as a 'goldmine for scammers'

The Federal Trade Commission (FTC) has slammed eight popular social media and video streaming platforms as ‘goldmines for scammers,’ as they launch a probe into how they scrutinize deceptive advertising.

Meta, Instagram, YouTube, TikTok, Snap, Twitter, Pinterest, and Twitch are being asked by the FTC to provide information on how to restrict paid commercial advertising that is deceptive or exposes consumers to fraudulent health-care products, financial scams, counterfeit and fake goods, or other fraud is examined.

The commission, which works to promote competition and protect and educate consumers, will also look at how these platforms ensure that consumers can identify commercial advertising.

‘Social media has been a gold mine for scammers who tout sham products and other scams that have cost consumers enormously in recent years,’ said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection.

‘This study will help the FTC ensure that social media and video streaming companies are doing everything they can to keep scammers and deceptive ads off their platforms.’

Companies will have to relinquish their standards and policies as part of the investigation related to paid commercial ads and the process of screening and monitoring for compliance with those standards and policies, including through human and automated system review.

The companies will also have to report their ad revenue, the number of ad views and other performance metrics including ads involving categories of products and services more prone to deception such as those intended to treat, prevent, or cure substance use disorders and tout income opportunities.

It’s hoped the investigation will shed light on how prevalent deceptive advertising is on social media and video streaming platforms, consumers who may be harmed and the effectiveness of oversight of advertisers – including whether companies differ in their approach to ads in different languages.

Source of data and images: dailymail

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