SCAM Act
Sponsored By: Senator Ruben Gallego
Introduced
Summary
Stop fraud in paid online ads. This bill would require online platforms to verify advertisers, detect impersonations, and remove deceptive paid ads quickly.
Show full summary
- Users get a clear, conspicuous tool to report suspicious ads. Platforms must investigate reports within 72 hours, notify the reporter within 24 hours after the investigation, and remove violating ads within 24 hours of a determination.
- Platforms would have to verify advertiser identity with legal names, physical locations, government IDs or business documents. They must run automated and manual fraud detection and maintain impersonation-mitigation programs.
- The Federal Trade Commission would enforce the rules and state attorneys general can sue. Individuals harmed can seek injunctive relief and actual damages with a 5-year discovery window and up to triple damages for willful violations. Prevailing plaintiffs may recover costs and attorney’s fees.
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 2 benefits, 0 costs, 1 mixed.
Stricter rules on paid online ads
If enacted, online platforms that accept payment to show ads would have to verify advertiser identity before placing paid ads. Platforms would collect legal name, physical location, government ID or business documents, and contact information. Platforms would run impersonation detection and automated and manual fraud-detection systems. Users would get a clear tool to report suspect ads. Platforms would have to start investigating reports within 72 hours, notify the reporter within 24 hours after finishing the investigation, and remove ads the platform finds unlawful within 24 hours of that finding.
New private suits and platform liability
If enacted, any person harmed by a covered violation would be able to sue in federal court for injunctions, actual damages, restitution, and other relief. Courts could increase damages up to three times for willful or knowing violations. A plaintiff generally would have five years from discovery to start a case, and prevailing plaintiffs could get litigation costs and reasonable attorney's fees. State attorneys general could sue on behalf of residents but generally must notify the FTC and provide a copy of the complaint before suing. Section 230(c)(1) would not protect platforms for violations of this Act, but Section 230(c)(2) would remain. Platforms that get FTC approval for an ad-fraud detection program and show they follow it and fund it would get a legal presumption they took reasonable steps.
FTC rulemaking and payments report
If enacted, the Federal Trade Commission would have to issue rules implementing this Act within one year and review them each year. The FTC would also submit a report within nine months to the Senate Committee on Banking, Housing, and Urban Affairs and the House Committee on Financial Services. That report would assess gaps that let online payment scams persist and recommend legislative or administrative actions.
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Sponsors & CoSponsors
Sponsor
Ruben Gallego
AZ • D
Cosponsors
Bernie Moreno
OH • R
Sponsored 2/4/2026
David McCormick
PA • R
Sponsored 3/4/2026
Peter Welch
VT • D
Sponsored 3/4/2026
Amy Klobuchar
MN • D
Sponsored 3/10/2026
Katie Britt
AL • R
Sponsored 3/24/2026
Christopher Coons
DE • D
Sponsored 4/13/2026
Lindsey Graham
SC • R
Sponsored 4/13/2026
Roll Call Votes
No roll call votes available for this bill.
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