FTC targets platforms behind government impersonation scams

The Federal Trade Commission is opening a new rulemaking aimed at search engines, social media networks and other digital marketplace platforms that facilitate government and business impersonation scams. The Federal Register notice published October 1 says the agency is targeting a platform incentive problem: companies can profit from optimizing and distributing third-party ads, including fraudulent ones, while the social cost of impersonation scams falls elsewhere.

That is the relevant crypto angle. A fake government or business account can use the same online ad machinery to solicit funds or personal information from digital-asset users.

The FTC’s filing puts the scale in numbers. Consumers reported approximately $16 billion in fraud losses in 2025, a 25% increase from 2024. Using the filing’s figures, the implied 2024 total is $16 billion ÷ 1.25 = $12.8 billion, meaning reported losses rose by roughly $3.2 billion in one year.

Impersonation was the FTC’s top reported fraud category, with more than 1 million imposter reports and nearly $3.5 billion in reported losses last year.

The filing’s strongest case is about distribution, not just the scammer’s message. Platforms provide ad-optimization tools that can develop advertising content and use detailed consumer data to tailor ads. They can generate revenue when those tools are used, when ads are posted, or when consumers engage with them. The FTC also says online scams are more likely to produce monetary losses than scams initiated by phone or text, while social media is among scammers’ most-used contact methods and the costliest channel for consumers.

That expands the scope of the FTC’s March 2024 Rule on Impersonation of Government and Businesses, which prohibits impersonating governments, businesses, and their officers or agents as unfair or deceptive acts or practices under Section 5 of the Federal Trade Commission Act. The new proceeding is aimed at platforms that facilitate the activity, including their role in optimizing fraudulent advertising.

For crypto users, the immediate consequence is procedural. The notice does not establish a final platform liability standard or state how enforcement would apply to decentralized platforms and user-generated content. Those boundaries are among the questions the FTC is seeking to resolve, including how it will define “impersonation” and “deceptive acts” in those settings.

The practical deadline is November 30, 2026. Comments must be received by then. Platforms, advertisers and users whose funds or personal information are solicited through impersonation campaigns are the groups most directly affected: the first may face new obligations if the rule is finalized, while the latter would gain a possible federal enforcement framework beyond the 2024 prohibition.

The FTC began considering impersonation fraud rules in December 2021, published a notice of proposed rulemaking in 2022 and finalized the existing rule in March 2024. The October 2026 ANPRM is the next step aimed at the distribution layer.