Facebook parent Meta has been found liable for fraudulent advertising on its Instagram and Facebook platforms, Germany’s Frankfurt regional court ruled on Thursday, in a case involving a financial advise website whose identifying imagery was misused.

The website, Finanzfluss, said its logo and photos of its founder were used to promote fraudulent investment schemes.

The company reported nearly 260 violations to Meta in August 2024 alone, and that Meta took up to 62 days to remove some content, according to the court.

Financial fraud

Meta claimed it was unaware of the content, a defence allowed under the EU’s Digital Services Act.

But the court ruled this was not valid under the circumstances, since Meta has control over the content, citing a decision by the European Court of Justice.

The company was also told to share information with the claimant regarding the fake ads, including the revenue it generated from them.

Meta said it disagreed with the verdict, which can be appealed, and was considering further steps. It said it had taken action on the content after it was reported.

According to a Reuters report last year, Meta estimated 10 percent of its 2024 revenue would come from ads for scams and banned goods.

Meta has faced several lawsuits over fraudulent adverts on its platforms, including a US class-action lawsuit filed in April and a lawsuit by Australia’s competition regulator in 2022.

New rules

In December, Which? accused Meta of allowing fake ads and fraudulent storefronts to “run rampant” on its platforms.

Last November, EU member states and the European Parliament agreed new rules that give platforms such as social media companies partial responsibility for online fraud and oblige them to remove fraudulent ads.