Facebook should verify all advertisers to crack down on fraud, top brands demand

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Facebook should be forced to ­require advertisers to pass identity checks, a coalition of the world's biggest brands has demanded amid rising concern over fraud and misinformation.

The World Federation of Advertisers (WFA), which represents thousands of companies including top spenders such as Unilever, Vodafone and Volkswagen, has said forthcoming European laws should require social media networks to verify all advertisers.

It is the latest case of big brands putting pressure on social media companies to clean up their services following a row over hate speech earlier this year and revelations that Facebook was ­providing faulty data about how ­effective adverts had been.

In a submission to a European Union consultation on its forthcoming Digital Services Act, a new set of rules to ­govern the internet, the WFA said large companies that publish or carry online advertising should follow laws modelled on the "know your customer" rules that regulate banking.

Illicit adverts have become a severe problem during the pandemic, with scammers profiting from shortages of essential items and economic pressure. "Fraudulent advertising has emerged as a gateway to illicit sales ­online and as a new threat to both ­advertisers and consumers," the WFA said in its consultation response.

"In order to tackle fraudulent ­advertising, we believe that the Digital Services Act should put in place a ­harmonised and proportionate 'know your advertiser' verification mechanism for all platforms which display [or] publish ads," it added.

In recent years, online advertising publishers have begun to confirm identities if they are running sensitive adverts such as those related to social or political issues. Google and Facebook, the two biggest destinations for digital ad spending, have required political advertisers to verify their identity using a government ID since 2018.

In April, Google pledged to confirm all advertisers' identities following a wave of complaints about fraudulent adverts such as those for unregulated investment schemes. Facebook, meanwhile, has not committed to verifying the identities of the more than 7m advertisers on its services.

A spokesman for the social network pointed to a recent blog post from advertising executive Rob Leathern saying the company was committed to improving verification for advertisers, but that the process would take years.

"The last thing we want is to add even more burden to small businesses at a time when they're already overwhelmed. We're exploring a variety of verification mechanisms. None of these are perfect," Mr Leathern wrote.

More than 1000 companies, including many of the top advertisers, clashed with Facebook in July when they took part in a month-long boycott in protest at the tech giant's handling of hate speech and misinformation. The company has also admitted to inflating the number of people who saw video ­adverts, leading to a $40m ­payout last year.