What do ad fraud and the drug trade have in common?

Sarah Homewood
By Sarah Homewood | 7 June 2016
[Photo credit: Got Credit] A copy of the creative commons license can be found here

Ad fraud is tipped to become a $50 billion dollar problem globally by 2025, with the World Federation of Advertisers (WFA) issuing its first guidelines to help marketers and brands tackle the problem.

The WFA says that ad fraud is second only to the drugs trade as a source of income for organised crime and advertisers are the “only” victims.

Agencies, vendors and media owners still benefit from ad fraud, albeit unintentionally, from fees and commission when fraud occurs. To help brands when it comes to investing money in digital, the WFA has teamed up with the Advertising Fraud Council and research firm Botlab.io to create the WFA’s 'Compendium of Ad Fraud Knowledge for Media Investors'.

This document has four key suggestions for tackling this problem:

  • People and technology: brands need to develop in-house expertise to support vendor selection, work with cyber security partners to help understand common threats and demand full transparency of investment.
  • Education and communication: Brands need to set clear expectations of what they demand from their partners.
  • Standards: Brands should avoid run of exchange buys in favour of databases of safe sites. Advertisers that need to hit digital investment targets may have to accept that these will not be achievable without exposing themselves to high levels of fraud.
  • Governance: Contracts with agencies and vendor partners need to be revised to ensure that there are clear penalties for misallocating spend to ad fraud related inventory, where preventing it could be reasonably achieved. Those elements of the ad tech chain that have benefited from fraudulent activity in the form of commissions and fees should be requested to return them to the advertiser.

WFA CEO Stephan Loerke says: “Advertisers are the sole victim of ad fraud and the WFA wants to equip them with the tools to minimise their exposure. There is much that advertisers can do to improve the situation in terms of setting new standards, contractual changes and increased transparency, but ultimately behaviour change is required across the industry.”

This isn't the first time a group has formed to try and tackle the ad fraud problem, with the IAB, ANA and 4A's joining forces in the US to launch the Trustworthy Accountability Group.

The program provides buyers, sellers and intermediaries in the digital advertising supply chain with a kitemark that certifies they have adhered to anti-fraud requirements.

Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au

Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.

comments powered by Disqus