World of Scams: The Fraud Problem at the Heart of Online Advertising

The proliferation of online scams are a global problem with Canadian consequences. In recent years, scams ranging from pyramid schemes, sham investments, and long-running confidence games have fleeced Canadians to the tune of over $650 million. These costs balloon further when we consider ad fraud, the misrepresenting of low quality advertising supply, and its ability to cheat businesses out of their legitimate advertising dollars. Facilitating this tidal wave of scams is an oligopoly online advertising market that creates highly detailed profiles of consumers, obscures the identities of advertisers, and turns a blind eye to revenue earned through fraudulent ads.

In a new report, CAMP lays out the harms to consumers and businesses from this growing world of scams, successful regulatory interventions from peer jurisdictions, and what Canada can do to better protect our citizens. Stemming the tide of scams means changing the incentives that make their proliferation profitable. To set a course for safer internet for Canadian consumers and businesses, policymakers should:

• Strengthen data protection laws, restricting the creation, collection, and use of sensitive information for advertising purposes
• Require know-your-customer and advertiser verification and reporting, giving researchers and companies the tools to understand the market and keep competition fair
• Develop anti-scam regulations outlining the responsibilities of large advertising platforms, including transparency requirements, and obligations to prevent, detect, and remove fraudulent content
• Empower regulators the Office of the Privacy Commissioner and law enforcement agencies like the Competition Bureau to ensure compliance with anti-scam laws