SCAM Act Legislation Introduced to Hold Platforms Accountable for Deceptive Ads

February 19, 2026 / Richard B. Newman

On February 4, 2026 Senators Gellego (D-AZ) and Moreno (R-OH) introduced bipartisan legislation to crack down on deceptive online ads.  The Safeguarding Consumers from Advertising Misconduct (“SCAM”) Act would require online platforms to take reasonable steps to prevent fraudulent and deceptive ads and strengthen accountability when they slip through the cracks.

The bill could potentially strengthen the Federal Trade Commission’s and states’ ability to enforce violations of consumer protection laws.  It could also limit Section 230 Communications Decency Act protection for online platforms that run paid advertising.

“Scammers are using social media to swindle Americans out of their hard-earned savings, and right now, those platforms face almost no consequences for letting it happen,” said Senator Gallego. “If a company is making money from running ads on their site, it has a responsibility to make sure those ads aren’t fraudulent. This bipartisan bill will hold social media companies accountable and protect consumers’ money online.”

“It is critical that we protect American consumers from deceptive ads and shameless fraudsters who make millions taking advantage of legal loopholes. We can’t sit by while social media companies have business models that knowingly enable scams that target the American people,” said Senator Moreno.

Key provisions of the bill include advertiser verification requirements and require reasonable steps on the part of platforms to prevent and review fraud.

While no major tech companies have issued formal opposition statements yet, the bill’s prospects will likely depend on industry response:

If you would like to discuss how this proposed legislation might impact your business, contact an experienced FTC defense lawyer.  Query whether this proposed legislation will pass in its current form, if at all.  Social media companies and big tech are almost certain to throw big money towards opposing the bill.

Richard B. Newman is an advertising practices compliance attorney at Hinch Newman LLP. 

Informational purposes only. Not legal advice. This article is not intended to and should not be construed as legal advice. May be considered attorney advertising.

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Richard B. Newman

Richard B. Newman is a nationally recognized FTC advertising compliance, CID investigation and regulatory enforcemetn attorney. He regularly provides advertising counsel and represents clients in high-profile investigations and enforcement proceedings initiated by the Federal Trade Commission, state attorneys general, departments of consumer affairs, and other federal and state agencies with jurisdiction over advertising and marketing practices. Richard is also an ecommerce lawyer and spam defense attorney. His practice additionally focuses upon false advertising defense, data privacy, cybersquatting, intellectual property law and transactional matters relating to the dissemination of national advertising campaigns, including the gamut of affiliate marketing, telemarketing, lead generation, list management and licensing agreements. Richard advises clients on how to minimize the legal risks associated with digital marketing, email marketing, telemarketing, social media influencer campaigns, endorsements and testimonials, negative option marketing models, native advertising, online promotions and comparative advertising,

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