For a while now, Facebook has imposed a ban on crypto ads due to the high number of fraudulent crypto projects. However, one developer decided to pounce on this and come up with software to help scammers dodge the ad-review system that filters out crypto scams.
Facebook Is Suing
Facebook decided that not only will it ban the developer from its platform but it will also sue him.faceb The lawsuit is targeted at the founder of LEadCloak, Basant Gajjar. According to the lawsuit, Gajjar has been helping scammers target users of Facebook with fake COVID-19 ads on Facebook and Instagram. Gajjar, who is based in Bangkok, is an Indian national, who has been running an unregistered business in the state of California since 2016. He has been using the business to sell the cloaking software. A NY Times report states that the lawsuit was filed in the US District Court in the Northern District of California.
What is Ad- Cloaking?
Ad cloaking is a dubious technique used mainly by scammers to escape the scrutiny of ad-review systems. The cloaking works by directing the system to a genuine website for each ad. As a result, the system believes a different product is being advertised from what the user of a site sees.
The software developed by LeadCloak has been used to conceal ads that are related to fraudulent COIVD-19 sites, medical products, diet pills, crypto, and fake news. Some of the cloaked ads used the images of famous people to give legitimacy to scams. Some of the celebs whose images have been used have filed lawsuits against Facebook. Besides that, several tech firms such as Spotify, Oath, Shopify, and WordPress, have had their logos used to promote scams.
About the Lawsuit
The lawsuit by Facebook claims that LeadCloak violated its technical compliance policies. Besides the company, Facebook is also pursuing those that used the software. According to Facebook, they hope that through the lawsuit, they will identify clients of LeadCloak and take action against them as well.
In 2019, Facebook loosened some of the restrictions it had imposed on crypto and blockchain projects. As a result, genuine projects were allowed to promote their activities on the giant social media site. However, scammers have been misusing the system via cloaking software.