About

FTC Seeks Comment on Whether Platform Ad Tools Should Face Impersonation Scam Rules

Published
Score
13

Why it matters

The Federal Trade Commission has asked whether online platforms should face liability for the ad-optimization tools scammers use to run fake ads. The agency voted 2-0 to issue an Advance Notice of Proposed Rulemaking, announced September 24 and published in the Federal Register October 1. It asks whether search engines, social networks, and marketplaces should bear responsibility when their ad content building, audience targeting, or placement decisions help impersonation scams. The existing Rule on Impersonation of Government and Businesses (16 C.F.R. Part 461), in effect since 2024, targets scammers who falsely pose as government agencies or businesses. It does not reach platform conduct. In 2025 the FTC logged more than one million imposter scam reports with nearly $3.5 billion in reported losses. Christopher Mufarrige, Director of the Bureau of Consumer Protection, framed the notice around platforms that profit from amplifying those scams. Public comments are due November 30, 2026.

The notice proposes no binding rule and includes no proposed rule text. It binds no platform, advertiser, or consumer. The FTC has not chosen a path. It is weighing three options: amending the current rule, proposing a new rule, or non-regulatory measures. Any rulemaking would follow the more demanding Magnuson-Moss procedures and would seek comment on the Section 230 liability shield. The FTC has concluded that Section 230 does not block it from pursuing the rulemaking, but courts have not tested that position in this context. Whether ad-optimization tools will carry legal liability remains undecided.

For attorneys, the near-term action is the comment window, which closes November 30. Clients that run search ads, especially banks and companies frequently impersonated in them, should review their ad and anti-fraud programs now and consider whether to submit comments. Advertising technology and AI tool providers are the other group law firms have flagged as potentially exposed. Coverage from October 13 is law-firm analysis of a notice first announced September 24, so the story is renewed attention to an existing proceeding, not a new FTC enforcement action.

Sources

mail Subscribe to FTC Enforcement email updates

Primary sources. No fluff. Straight to your inbox.

Also on LawSnap