S 8605: Requires social-media platforms to prevent, detect, and remove fraudulent advertisements and to establish advertiser-vetting obligations; requires reporting to the attorney general.

  
  STATE OF NEW YORK ________________________________________________________________________ 8605 2025-2026 Regular Sessions  IN SENATE December 5, 2025 ___________ Introduced by Sen. COMRIE -- read twice and ordered printed, and when printed to be committed to the Committee on Rules AN ACT to amend the general business law, in relation to requiring social-media platforms to prevent, detect, and remove fraudulent advertisements The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Legislative findings and purpose. The legislature finds 2 that fraudulent advertisements for products, services, applications, 3 investments, health claims, and other commercial offerings have prolif- 4 erated on social-media platforms accessible to New York residents. 5 Consumers including seniors, minors, persons with limited technolog- 6 ical literacy, and financially vulnerable individuals have suffered 7 substantial monetary loss and harms due to deceptive or fraudulent 8 advertisements that were not adequately screened by advertising plat- 9 forms. 10 While existing law, including section 349 of the general business law, 11 prohibits deceptive acts and practices, such provisions do not expressly 12 require digital platforms to vet advertisers, verify legitimacy, or 13 maintain reasonable fraud-prevention systems before publishing adver- 14 tisements. 15 Social-media platforms operate as major advertising channels and 16 derive substantial revenue from paid commercial content. As such, they 17 play a material role in the dissemination of fraudulent ads and must 18 bear responsibility for preventing foreseeable consumer harm. 19 It is the public policy of the state of New York to ensure social-me- 20 dia platforms (a) verify advertiser identities; (b) review advertise- 21 ments prior to publication; (c) remove or disable fraudulent advertise- 22 ments; (d) maintain records of vetting activities; and (e) report such 23 activities to the state. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD14178-01-5 
 S. 8605 2 1 Accordingly, this act establishes clear and enforceable obligations to 2 protect New York consumers from fraudulent ads. 3 § 2. The general business law is amended by adding a new article 33-C 4 to read as follows: 5 ARTICLE 33-C 6 FRAUDULENT SOCIAL-MEDIA ADVERTISING PREVENTION ACT 7 Section 699-a. Definitions. 8 699-b. Platform obligations. 9 699-c. Reporting requirements. 10 699-d. Enforcement; penalties; private right of action. 11 § 699-a. Definitions. As used in this article, the following terms 12 shall have the following meanings: 13 1. "Platform" means any online website, social-media service, mobile 14 application, or digital advertising network that displays third-party 15 paid advertisements to users located in New York, regardless of the 16 platform's principal place of business. 17 2. "Advertisement" or "ad" means any paid message, sponsored content, 18 promotional post, or commercial communication disseminated on a platform 19 for the purpose of marketing, selling, promoting, or inducing the 20 purchase or download of any product, service, application, or commercial 21 opportunity. 22 3. "Advertiser" means any person, business, or entity that pays for or 23 causes an advertisement to be displayed on a platform. 24 4. "Fraudulent advertisement" means any advertisement that: 25 (a) materially misrepresents, or is likely to mislead a reasonable 26 consumer as to, the nature, quality, price, terms, or characteristics of 27 the promoted good, service, or opportunity; 28 (b) promotes counterfeit, non-existent, or illicit goods or services; 29 (c) makes false or unsubstantiated claims; or 30 (d) links to, or directs consumers to, fraudulent, phishing, decep- 31 tive, or materially misrepresentative applications, websites, or 32 services. 33 5. "Vetting process" means written, reasonable, good-faith procedures 34 a platform uses to review advertisers and advertisements, including 35 identity verification, content screening, risk-flagging systems, land- 36 ing-page inspection, and complaint monitoring. 37 § 699-b. Platform obligations. 1. Platforms shall verify advertiser 38 identity prior to publishing any advertisement. Verification shall 39 include, but not be limited to: 40 (a) legal name; 41 (b) valid physical or business address; 42 (c) government-issued identification for individuals; and 43 (d) business registration, tax identification, or equivalent documen- 44 tation for entities. 45 2. Platforms shall maintain a reasonable vetting process to review 46 each advertisement before publication, including, but not be limited to: 47 (a) screening ad content for fraudulent, misleading, or high-risk 48 claims; 49 (b) reviewing the landing page, app store listing, website, or 50 external content linked in the advertisement; 51 (c) comparing advertiser statements to the actual product or service 52 to ensure consistency; and 53 (d) using automated and/or manual review systems designed to detect 54 fraudulent behavior patterns. 
 S. 8605 3 1 3. (a) Platforms shall maintain mechanisms to allow users and the 2 attorney general to report suspected fraudulent advertisements. 3 (b) Platforms shall remove or disable any advertisement that is 4 reasonably suspected to be fraudulent. 5 (c) Platforms shall promptly remove fraudulent advertisements upon 6 receiving credible notice or evidence of fraud. 7 4. Platforms shall maintain, for not less than five years: 8 (a) all verification information collected from advertisers; 9 (b) all advertisements reviewed, including logs indicating approval, 10 rejection, or removal; 11 (c) consumer or law-enforcement reports regarding fraudulent ads; and 12 (d) actions taken in response to such reports. 13 § 699-c. Reporting requirements. 1. Each platform shall file a quar- 14 terly report with the attorney general containing: 15 (a) the total number of advertisements submitted for review; 16 (b) the number of rejected, suspended, or removed advertisements due 17 to fraud or suspected fraud; 18 (c) the number of advertiser accounts suspended or banned due to frau- 19 dulent conduct; 20 (d) the number of user complaints or fraud reports received; and 21 (e) summary descriptions of improvements to fraud-prevention systems. 22 2. The attorney general shall publish an annual public summary of 23 platform compliance and enforcement actions under this article. 24 § 699-d. Enforcement; penalties; private right of action. 1. A 25 violation of this article constitutes a deceptive act or practice under 26 section three hundred forty-nine of this chapter. 27 2. The attorney general may bring an action to enjoin violations, 28 obtain restitution, and seek civil penalties. 29 3. Civil penalties for violations of this article shall not exceed 30 five thousand dollars per fraudulent advertisement, or ten thousand 31 dollars per advertisement for willful, repeated, or reckless violations. 32 4. Any person injured by a platform's knowing or negligent failure to 33 comply with this article may bring an action for actual damages, statu- 34 tory damages, injunctive relief, and reasonable attorney's fees. 35 5. A platform that demonstrates it maintained and enforced a reason- 36 able vetting process and acted promptly to remove fraudulent advertise- 37 ments upon discovery may use such effort as a defense to civil penal- 38 ties, but not to restitution owed to consumers. 39 § 3. Severability. If any provision of this act or its application is 40 adjudged to be invalid, such judgment shall not impair or invalidate the 41 remaining provisions, which shall remain in full force and effect. 42 § 4. This act shall take effect on the one hundred eightieth day after 43 it shall have become a law.