The CEO of Meta platforms, Mark Zuckerberg has been asked to respond to what his company is doing about cryptocurrency scams. A recent letter from a group of Democratic senators led by Senator Bob Menendez of New Jersey asked the Meta CEO to respond to the letter before the end of October.
Other senators who signed the letter are Sherrod Brown of Ohio, Elizabeth Warren of Massachusetts, Dianne Feinstein of California, Bernie Sanders of Vermont and Cory Booker of New Jersey.
49% of Crypto Scams from Social Media
A recent release from the Federal Trade Commission shows that 49% of cryptocurrency scams originate from social media such as WhatsApp, Facebook and Instagram which are subsidiaries of Meta. The data shows that consumers have lost $417 million to these scams from January 1, 2021 to March 31, 2022.
The letter dated September 8, requests that the company respond to it, explaining what it is doing about cryptocurrency scams. It asks that Meta explains the measures that they have put in place to identify scams that are being promoted through social media. They are to explain to the senators how they identify ads that are scams from those that are genuine.
Company’s Policy On Crypto Scams
Details of the expected response from Meta should explain the company’s recent policies regarding identifying scams and deplatforming of crypto scammers. The company should also explain its policy of cooperation with law enforcement agents in the fight against crypto scams.
Meta, formerly known as Facebook, has had conflicting policies on cryptocurrency ads. The company banned crypto ads after many scam ICOs were launched. It later lifted the ban on cryptocurrency ads but this has not deterred fraudulent ads from exploiting social media to deceive investors.
In March, the Australian Competition & Consumer Commission said that it would initiate legal action against Meta for misleading Facebook users with crypto ads that featured celebrities who were not aware of the content of the advertisements.