A bipartisan pair of House lawmakers has introduced a bill targeting the surge of fraudulent advertisements on social media platforms, with the legislation drawing swift support from the banking industry.
Rep. Dan Meuser (Republican, Pennsylvania) and Rep. Lou Correa (Democrat, California) on Friday (February 20) introduced the Safeguarding Consumers from Advertising Misconduct (SCAM) Act. According to the Press Release, the bill would hold digital platforms more accountable for deceptive and predatory ads.
The legislation comes as online scams have reached alarming levels. The Federal Trade Commission (FTC) estimates fraud losses hit nearly $196 billion in 2024 — including more than $81 billion lost by older Americans alone. Meuser, who chairs the House Financial Services Subcommittee on Oversight and Investigations, says roughly half of all reported scams now start on social media platforms.
The SCAM Act would require online platforms to verify advertiser identities, upgrade fraud detection systems, and provide clearer tools for users to report suspicious ads. The bill would also set deadlines for investigating complaints and removing deceptive ads, and it would strengthen enforcement powers for the FTC and state regulators. Consumers harmed by scam ads could also seek accountability under the new rules.
As reported by the ABA Banking Journal, American Bankers Association President and CEO Rob Nichols praised the bill's sponsors. "Each year, Americans lose billions of dollars to scams that originate in ads that appear on social media platforms, and this legislation requires social media companies to take reasonable steps to identify and prevent fraudulent and deceptive ads before they can do any damage," Nichols said. "We urge lawmakers to support this legislation and join the banking industry and other stakeholders in the fight against fraud."
The Bank Policy Institute also voiced strong support. In a statement released by the Bank Policy Institute (BPI), Senior Vice President and Head of Government Affairs Erik Rust called the measure a solution "everyone should support," noting that nearly three in four American adults have experienced some form of online scam or attack.
A companion bill has already been introduced in the Senate by Sen. Ruben Gallego (Democrat, Arizona) and Sen. Bernie Moreno (Republican, Ohio), giving the legislation a bicameral push. Supporters say the SCAM Act is designed to reduce financial losses and shield consumers from increasingly sophisticated schemes — including fake giveaways, impersonation scams, and AI-generated fraud content.
The bill now moves through the legislative process, with banking groups and consumer advocates urging Congress to act quickly.