The news: Citing a dramatic increase in the number of scam or fake advertisements, the Federal Trade Commission has ordered social and video platforms Twitter, Facebook, Pinterest, YouTube, and Twitch to file a report on how they vet ads.
What’s happening: The FTC has been pursuing a broad crackdown on online safety, launching inquiries into the use of advertising data, social media’s impact on teens, and online security. Now, it’s criticizing platforms for not properly protecting users from fraudulent ads and scams.
How did this happen? Last year’s cryptocurrency buzz likely contributed to the high volume of social media scams, but there’s another culprit, too: Digital platforms have been starving for ad revenues, which has led to a lower standard for what ads get the green light.
Our take: A rise in fraudulent social media ads can be attributed in part to shrinking revenues diluting the standards for what gets accepted. But it also shows that whatever automated processes tech giants have in place for vetting ads are allowing a large volume of bad actors to break in.