Why is Meta still feeding us garbage in response to their scam ads scandal?

Happy New Year! I thought I would start January with some inspiring ideas around platform democracy, but it turns out Meta’s fraud scandal is the unwanted gift that keeps on giving.

Recap: Back in early November of last year, intrepid Reuters reporter Jeff Horwitz reported that Meta estimated 10% of their annual revenue came from advertising for scams and fraud. Meta’s insulting PR response sent me off on a lengthy rant in which I called out multiple types of bullshit. [It’s a fun one, you should read it if you haven’t already.]

Horwitz delivered a new bombshell on New Year’s Eve, with leaked documents revealing that Meta has systematically tried to avoid regulatory pressure to crack down on the problem. Their official response was, again, defensive and misleading.

I have some thoughts about why Meta VP of Communications Andy Stone is doing such a terrible job of handling these leaks, but first I need to point out why his New Years Eve reaction was his worst yet.

Horwitz’s article opens with Japanese regulators finding tons of scam ads in Meta’s public Ad Library, which prompted Meta to reactively try to make the results look better, with both real takedowns and manipulations like changing the default search to not show past scam ads.

Stone ignores this sequence of events, and simply claims that “Meta teams regularly check the Ad Library to identify scam ads.” In a whiny rant on Threads, Stone even implies the article’s coverage somehow means that Reuters is criticizing Meta for removing any scam ads at all.

For the record, here’s the internal document from the Reuters story that makes it clear this all only started because of regulatory pressure, and was designed specifically to change regulator perceptions.

To stop the flood of bad ads, regulators want Meta to verify advertisers. This know-your-customer requirement has been shown to massively reduce scams and fraud, but Meta has been resisting a full global rollout due to cost and revenue impact.

Stone tries to say Meta is already complying voluntarily, because 70% of Meta’s advertising revenue is now coming from verified advertisers. Recall, however, that the original reporting in November was that 10% of Meta’s ad revenue is from scam and fraud advertisers.

If you passed elementary school math, you can probably see the issue here: 100-70=30, and 30>10. Stone’s big milestone here isn’t even close to squeezing out bad advertisers. Their unverified revenue is still three times bigger than the alleged problem! Surely this is as dumb as it gets.

Horwitz reports that an internal analysis from 2022 showed that 70% of new advertisers were promoting scams or other fraud. Stone’s defense is that Meta regularly disables these types of accounts, “some on the very day that they’re created.” Umm…

Since November, Stone’s go-to stat has been that “we have reduced user reports of scam ads globally by 58 percent.” In his Threads rant, he takes this a huge step further by saying “we've seen a more than 50 percent reduction in fraud and scams on platform.” He drops the words “reports” and “ads” and includes the word “fraud.” Suddenly a weak-sauce data point about user complaints has become a massive new claim of actual harm reduction, without any new supporting data or evidence.

This is insidious, because you have to be unbearably pedantic to track Stone’s shifting language from quote to quote to catch him in the act. Fortunately for you, I am that pedant.

[Stone does this more than once, but because each instance takes so long to explain, I cut this section down so you don’t drown in my pedantry. Email [email protected] if you want other examples.]

I doubt that Meta executives intentionally juiced their revenues with billions of dollars of scams and fraud. I suspect that systematic underfunding of their Integrity teams and the harm being externalized meant they simply didn’t realize how much of their revenue was bad until it was too late.

Now, they’re in serious trouble. The last time Meta slashed revenue estimates by 10% was in 2022 when Apple changed iOS privacy settings. Their stock price plummeted, and it took a couple of years for the business to rebound. If that all happens again, and so soon, it raises a question of whether the post-2022 recovery was real, or just scam ads filling the iOS hole.

In this scenario, the weak PR response is a cover-up / stalling tactic. The company has sent Andy Stone out to spin a defense from a few threadbare data points while the big boys try to get out of the deep, deep hole they’ve dug themselves into.

I keep picking on Andy Stone because even if he’s just cannon fodder, he messed up by making himself the story. His name is all over everything, and he’s fanning the flames by criticizing reporters with combative language like “disingenuous,” “false dichotomy,” and “misconstruing and misrepresenting,” without engaging in the substance of the leaks.

My best guess is that these are bad habits from his past political career as a press secretary. That’s a high-profile role on the front lines, fielding live questions from reporters and making the partisan case for an elected official’s priorities. Stone may think his job is to fight like hell for Zuck, without realizing it makes him sound like Sean Spicer being sent out to lie about inauguration crowd sizes.

By comparison, the best corporate communications teams, like those at Apple and Google, are effective because they stay in the background. When they are quoted, they are meticulous about ensuring it’s just attributed to “a spokesperson” or “the company.” Instead, they invest a lot of time in quiet briefings where they educate reporters on technology and the company’s point of view, building up trust that pays off in better coverage when shit hits the fan.

The final sign that something is seriously wrong at Meta is the absence of Integrity executives from the story. Good corporate communications teams know that the best spokesperson to discuss substantive issues is a company executive with direct knowledge of the situation. When I was at Google, I received multiple rounds of media training, my name was on important blog posts, and I was interviewed regularly by industry press. 

Why hasn’t Meta made a senior Ads Integrity executive available to Jeff Horwitz to go on the record, explain the truth behind the leaks in detail, and start to rebuild some trust? Maybe Meta executives are afraid Integrity leaders won’t stick to the corporate script. After all, this scandal is due to massive, ongoing leaks from within Meta. Clearly, someone in the company wants the world to know this isn’t right. Who wants to go on the record defending the indefensible?

Regardless of the reasons, as long as Meta keeps trotting Andy Stone out to claim all is well and insult reporters, I expect this fraud scandal will drag on.

Ideas? Feedback? Criticism? I want to hear it, because I am sure that I am going to get a lot of things wrong along the way. I will share what I learn with the community as we go. Reach out any time at [email protected].