Facebook Profits as Users Are Ripped Off by Scam Ads | Hacker News Reader

Facebook Profits as Users Are Ripped Off by Scam Ads

buzzfeednews.com

137 pointselorant49 comments

There was a company selling Microsoft software/licenses purchased with stolen credit cards advertising on Facebook that showed up in my feed. I reported the ad to Facebook and they declined to take any action to remove them. They continued for months selling credentials to Office365, etc. that were obviously fraudulent, and for some reason I frequently saw their ads. I ended up reporting them to Microsoft because I’m not a huge fan of fraudsters and wanted to see them brought to some sort of justice. Anyway, they eventually went offline, but I don’t know if it was any thanks to me or if their scam had simply run its course. They were never blocked or removed from Facebook. They just stopped buying ads and took down their website.

It took me less than a minute to figure out this company was fraudulent, but Facebook couldn’t do so even with a tip. It’s pretty clear that they either DGAF or are actively accommodating criminals as long as they buy ads.

Instagram is also full of bots, spammers, fakes and suspicious ads. I have previously reported some fake accounts obviously impersonating popular celebrities and they didn't take any action. Apparently engagement is what matters to them.

Same to some extent, is happening with Google, just more overtly.

Pretty much all the large players in the ad industry have done shady stuff. Even big G had to settle with the DoJ a decade ago for half a billion after advertising Canadian pharmacies that sold controlled drugs to Americans.

The ad industry is pretty much a business model to profit from lies- a la Madman

Report to FBI?

They don't have a choice. Wall St expects them to grow by 25% year to year, and as the opportunities to increase the user base are drying up, FB will have to use more and more predatory business models.

Since FB’s stock is structured such that Zuckerberg always has complete control[0], they are not really beholden to “Wall Street” (shareholders). Sure they want the price to go up, but the CEO cannot be removed without his consent. So on some level, they must want these things to happen, either that or they don’t care. (Neither possibility is particularly good, of course.)

[0] https://www.cnbc.com/2018/03/20/shareholders-wont-force-zuck...

Zuck is just an empty shell, really. He could be replaced with a tree and the company wouldn't notice. However the moment FB reaches a plateau, everybody will dump their stocks and buy treasury notes instead.

Facebook is still worth no less than $500B if they were to plateau this coming quarter. At that market cap, their PE would go down to 19 or so. Which is perfectly acceptable because they still have a decent moat, and opportunity to expand with Whatsapp and Messenger. Future possibilities of bigger Oculus growth too.

They are worth a bit under $800B right now. So even if they completely plateau with revenue and profit, the stock only drops 1/3. And this is all without them hypothetically giving a dividend too. So their cash would keep accumulating by tens of billions.

THIS! Facebook is always being grilled by politicians and the "news" because Wallstreet doesn't control Facebook, while they control politicians and the "news".

Look at this story for example. Are there scammers in the ads? Yes, all ad platforms will have some scammers. It's always been the case and it will continue to happen because there's benefit to scamming. Does FB take down scammers? Yes, constantly.

So, what is the news story? There is no news story. It's just a negative hit piece to try to devalue the company so that Zuckerberg may be forced to sell more of his shares giving away his veto rights. When that happens, all of this will magically go away.

> Does FB take down scammers? Yes, constantly

Well, in my experience: no. In Sweden where I reside and I'm sure in many other countries as well there have been regular surges of ads peddling a crypto-currency scam using fake interviews with well known celebrities as the hook ("I scored millions" etc). In 2019 I reported well over 70 of these ads and Facebook diligently reported that they investigated two (2) of these and found no reason to take action.

Now, the excuse I heard regarding these was that the scammers used some sort of dynamic links that detected and redirected depending on if the clicker was an fb employee or a sucker. But give. Me. a. Break.

Just because you see scammers doesn't mean Facebook doesn't do anything. It's just too easy and too lucrative for many more scammers.

There are reports of legitimate businesses being taken down by Facebook all the time. So which is it?

Are they this monopoly which does too much to cull businesses or is it too liberal to scammers? Well, it is both, as long as they can twist it to mean that "Facebook bad".

Stock price still matters for hiring.

So does demonstrating that your company is interested in making cool products instead of hooking scammers up.

And acquisitions, which are are frequently paid in part (or entirely) with stock.

But acquisitions in the case of FB are used as defensive, kill-our-competition moves. Is that really justifiable?

Same for hiring. FB's money making machine needs very few engineers, but it still needs to keep hiring to deprive potential competitors from competent programmers.

At 25% yearly they better start getting all the populated planets in this spiral arm of the galaxy to sign up.

Hey... what if the first time we receive an alien signal it ends up being a social network invite?

Well if you believe some of what’s circulating on Facebook they’re already among us.

Hey who knows, this might be the motivation we need to make extraterrestrial contact. Powered by Facebook of course.

FB will buy them up of course.

I'd read this book

Either way, regulation is the answer.

There's this company running ads selling a retro pi for $300 loaded with pirated software. Tried to find some way of reporting it to Facebook – unless I'm a representative of an aggrieved corporation they don't care.

I don't see the problem. Why do you care about someone pirating someone else's software... specially when the software being pirated is ancient video game roms which you can download from anywhere?

Cause it’s illegal??

This is akin to not calling the fire department to help your neighbors burning house on the fact that they have a well and water available...

It's more like calling the police because a kid stole a berry from the neighbor's garden... except imagine that no matter how many berries the kid takes, there will be the same exact amount there... and the berry is in the nearby forest anyway because it's invasive like that... and someone is buying from the kid because they don't want to go to the forest themselves.

Isn't this simply how media firms generally behave? Even things aimed at kids like comic books always had obviously scammy stuff like ads for fake products ("X-Ray Goggles"), multi-level marketing recruitment, etc.

Well, they refused to publish ads about a friends adult-oriented podcast, so they do do some filtering.

I think most companies just have an automatic filter against adult content, even if it might be harmless. Just like the constant oppression of sex industry workers by the rest of the services industry.

I almost fell prey to one such ad. A friend asked me to buy him a communicator device that came in two modes that were poorly differentiated. The seller wouldn't answer my emails about the differentiation and the contact number was not valid (one digit short). Then I googled said product only to to find that:

(1) The device was a kickstarter project and obviously wasn't ready for sale https://www.indiegogo.com/projects/cosmo-communicator#/

(2) The device was being offered for sale on many sites e.g. https://store.planetcom.co.uk/products/cosmo-communicator

I reported to Facebook but no action was taken as far as I could see.

They are a monopoly, both in terms of social media and also advertising to large segments user by legitimate business. Recently, they have been cracking down but their algorithms are very poor at identifying legit vs scam accounts and ads. There are now countless stories of local SMEs and businesses who have been spending hundreds or thousands on FB ads for several years suddenly locked out of their accounts with no recourse for appeal.

Facebook having been the main source of marketing they have done. Revenues are drying up that have already been hit by the pandemic. While a business built on a single source for advertising may not be the best, it truly shows the company's monopoly power. Banned users have no where else to go, there are no competitors or alternatives.

My 65 year old mom was scammed via a Facebook ad, she thought she was buying a quilt

I wonder what the incentive model for the business and sales people selling the ads looks like. I understand that developers may be well intentioned there. However, they build a dual use technology and as long as the incentives for business people managing the system are purely profit oriented it is clear that the system will be used in both ways.

Doesn't any ad network profit when a user is ripped off by scam ads? This isn't Facebook specific.

I wonder how many scammy ads have run on the Buzzfeed family of sites? There is a pretty good chance that the people writing this article are themselves paid for by scammy ads.

The fix for scammy ads is easy. Just make the advertising network liable for all ads shown. Since they are making money from them, they should also shoulder the risk.

Not just facebook

Google also allows scam ads

This feels like a long “water is wet” article.

Maybe to you but for those who are uninformed it's valuable

How did talk radio solve this problem?

If users are pissed off about Facebook profiting off of them they should have just bought Facebook stock and reaped their share of the profits. Don’t follow Facebook ads.

Don't like seeing grandma and grandpa get scammed to make some guy's stock price go up? Should have bought the stock yourself! (??)

There's a lot of misinformation here, and it's clear the author didn't do their homework by simply putting $10 into Facebook ads.

FB gives pretty good data on who sees the ads, and advertisers are well aware. Moreover, it's fairly easy to explicitly target demographics.

If TikTok ads were being seen by quite a lot of 35 year old men, then this was part of TikTok's strategy.

It's foolish to spend a lot of money on such ads without having some measure of their effectiveness and FB and Google actually do give tons of data.

Compare this to TV or print, wherein advertisers have only a very crude idea of who is seeing their ads.

As someone who buys ads myself, Facebook is frankly probably the best platform in terms of being able to access large audiences with decent data, and frankly getting decent activity from the ads.

Google keywords are good for only specific things and most banner ad networks are worthless.

Lol, FB and Google constantly fib about their ad results. As long as I create an Ad dashboard with cool features that marketing managers in companies love (with graphs, BS metrics, etc), I'm sure I'll have tons of buyers.

Wasn’t there a scandal a year or so ago where Facebook was lying about ad results?

They're not perfectly accurate, but there's little reason for them to lie.

Moreover, when you're dealing with conversion measurements, it doesn't matter that much.

You're either getting the sales or not and that's part of the budget/spend calculus.

>If TikTok ads were being seen by quite a lot of 35 year old men, then this was part of TikTok's strategy.

I don't think the article disputes that. The impression I got from the article is that this was indeed working as intended. The question people were raising is whether or not this was moral for Facebook to allow.

There's more to the article than the TikTok story. Facebook is regularly allowing ads to run that violates it's own policies even when those ads are reported by their own ad moderators.

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