Rhode Island has filed what its attorney general calls the first lawsuit by a US state against Meta over scam advertising. The Meta scam ads lawsuit, brought by Attorney General Peter Neronha in Providence County Superior Court, claims the company did more than fail to block fraudulent ads on Facebook, Instagram and WhatsApp. It says Meta's own automated advertising systems helped scammers design those ads, pick their targets and show them again and again to the people most likely to fall for them.
That second claim is what makes the case matter beyond Rhode Island. It treats the AI-driven ad machinery itself, not just the content that passes through it, as part of the alleged harm.
What the Meta scam ads lawsuit alleges
According to the attorney general's announcement, the complaint says Meta helped "create, refine and distribute" ads for a long list of schemes. These include impersonation scams, fake investment offers, false promises of Medicare and Social Security benefits, and dangerous or ineffective health supplements and treatments. The office singles out older residents as a group that has lost substantial sums to ads seen on Meta platforms.
The complaint focuses on the services Meta sells to advertisers. The attorney general lists them as:
- design assistance for ad creative
- audience-selection and targeting tools
- optimisation systems that decide who sees which version of an ad
- delivery services and analytics
The state argues these tools, fed by Meta's data on its account holders, let advertisers find and repeatedly reach the consumers most likely to respond to fraud. AML Intelligence, which reported the filing, said the suit alleges Meta's AI ad creation tools helped scammers build their marketing. Fox Business coverage of the case quoted the complaint as saying Meta "knowingly helped create and optimize these ads".
The money at the centre of the case
Much of the state's argument rests on figures from a Reuters investigation published in November 2025, which drew on internal Meta documents. As cited in the attorney general's release:
- About 10% of Meta's annual ad revenue, roughly $16 billion, came from ads for scams or banned goods.
- Meta showed users about 15 billion ads a day that carried clear signs of fraud.
- Ads that "present higher legal risk" brought in about $7 billion a year.
- Instead of removing some suspected fraudsters, Meta charged them a premium to keep advertising.
AML Intelligence also cited research by the Center for Countering Digital Hate that found nearly 94,000 scam ads on Meta's platforms, including one ad claiming to reverse Alzheimer's that had more than 2,000 versions active in Meta's ad library.
"As alleged, Meta knowingly exposed vulnerable users to fraud and scams, and made enormous profits in doing so," Neronha said in the announcement.
What Rhode Island wants from the court
The case is brought under the Rhode Island Deceptive Trade Practices Act, an enforcement power Neronha's office regained in 2021 with the state legislature's help. The state is asking for:
- a declaration that Meta broke the Act
- an injunction to stop the practices
- restitution for Rhode Island consumers who lost money
- civil penalties for each violation
- disgorgement of what the state calls ill-gotten gains, with interest
- a court-appointed receiver, auditor or monitor to check compliance
The last item would put an outside party inside Meta's ad operations if the state wins, which would be an unusual remedy for an ad-review dispute.
Meta's position
The sources available at publication did not include a Meta response to this specific lawsuit. When Reuters published its investigation last year, Meta spokesman Andy Stone called it "a selective view that distorts Meta's approach to fraud and scams". Meta has said publicly that it invests heavily in detecting scams and removes large volumes of fraudulent ads.
Why this matters for AI accountability
Most legal fights over online scams have centred on whether a platform should have taken down bad content. This complaint goes a step further. It argues that automated systems which write, test and target ads are services the platform provides, and that a company can be responsible for how those services are used when it knows the results.
That theory lines up with a wider shift in how regulators look at AI. US agencies are already asking AI developers how their systems behave once deployed, as our report on the FTC investigation of OpenAI and Anthropic sets out. Generative ad tools are among the most widely used AI products in the world, and few people think of them as AI at all.
Rhode Island is not acting alone on the broader issue. Santa Clara County in California filed a similar suit in May, according to AML Intelligence. Rhode Island was also part of an August 2026 multistate settlement with Meta worth up to $17.1 billion, under which the state receives at least $49.4 million and up to $64.5 million, and Meta agreed to child-safety changes on Instagram and Facebook. That settlement covered different conduct.
What to watch next
Meta will have the chance to answer the complaint in court, and early motions are likely to test whether a state consumer-protection law can reach the design of ad systems. Other attorneys general will be watching. If a judge accepts that AI ad tools can make a platform a participant in fraud, the same argument could be used against any company whose automated systems help bad actors find victims.
For readers, the practical advice has not changed. Treat ads promising government benefits, miracle cures or guaranteed investment returns with suspicion, and report them on the platform where you saw them. The complaint itself is available from the Rhode Island attorney general's office for anyone who wants to read the full allegations.
