Exclusive: Meta accepted billions in revenue from China-linked scam ads, despite internal warnings that fraud was harming users worldwide, a Reuters investigation finds.

A Reuters investigation has revealed that Meta Platforms Inc., the parent company of Facebook, Instagram and WhatsApp, knowingly tolerated high levels of fraudulent advertising from China in order to protect billions of dollars in revenue.

According to internal company documents reviewed by Reuters, Meta determined that nearly one-fifth of its China-linked advertising revenue — more than $3 billion annually — came from ads promoting scams, illegal gambling, deceptive investments, pornography and other banned content. Despite recognizing the scale of the harm, Meta chose to limit enforcement efforts to avoid what it described internally as a “revenue impact.”

China has become a crucial market for Meta’s advertising business, even though its citizens are banned from using Meta’s social media platforms. Chinese companies are allowed to advertise to overseas users, helping Meta generate more than $18 billion in annual revenue from China in 2024 — about 11% of its global income.

Internal documents show Meta briefly reduced scam-related ads from China in late 2024 by forming a dedicated enforcement team. However, after intervention linked to CEO Mark Zuckerberg and a shift in company strategy, the team was disbanded, restrictions on Chinese ad agencies were lifted, and several effective anti-fraud measures were shelved. Within months, fraudulent ads rebounded.

The investigation found that Meta relies on a complex network of Chinese ad agencies, including “top-tier resellers,” which receive commissions and special protections. Ads flagged as suspicious are often allowed to run during lengthy secondary reviews, giving scammers time to reach large audiences. Some agencies openly advertise their ability to bypass Meta’s enforcement systems.

An external report commissioned by Meta warned that the company’s own policies were fueling systemic abuse, stating that Chinese authorities generally do not interfere when fraud targets foreign users. As a result, scammers face little risk.

Despite mounting evidence of consumer harm — including U.S. authorities seizing hundreds of millions of dollars linked to scams advertised on Meta platforms — internal documents show Meta opted to tolerate elevated levels of misconduct from Chinese advertisers rather than pursue stricter enforcement.

Meta said it has removed millions of ads and cooperates with law enforcement, but did not directly address many findings raised by Reuters. Critics argue the case exposes a fundamental trade-off Meta has made between user safety and profit.