Facebook will launch a new tool in the UK to combat fraudulent ads that appear on its platforms after reaching a settlement with Martin Lewis, the celebrity consumer finance journalist, who had sued the social media giant for defamation.

Lewis, the founder of MoneySavingExpert.com, sued Facebook last April after more than 1,000 scam ads appeared on the site using his name and image without permission, the Guardian reported.

He has now agreed to drop the lawsuit after Facebook promised to launch its new anti-scam tool in the summer that also will be supported by a dedicated team to handle complaints from users.

In addition, Facebook will donate £3m to a scam-prevention charity, whose project Citizens Advice Scams Action (Casa) will launch in May with the aim of identifying and tackling online scams in the UK as well as supporting victims.

Lewis, who had promised that any proceeds from his lawsuit would go to charity, welcomed Facebook’s action and said its £3m donation was far more than he could have won had he succeeded in court.

Speaking at a press conference to highlight the issue, Lewis said: “My aim was to try and reduce and stop the hideous number of scam adverts that had been going on in UK online advertising that have really hurt real people.”

He said thousands of consumers in the UK have been tricked out of their money and that any ad featuring his name or image is “a lie, it’s a scam... I don’t do adverts."

Lewis further warned of a “national epidemic of scams”, which also include finance and phone fraud, but he said he believed Facebook’s new anti-scam tool would achieve “real tangible change”, the Financial Times reported.

Speaking at the same event, Steve Hatch, Facebook’s regional director for northern Europe, said the company would monitor the effectiveness of the new anti-scam tool and then decide whether to roll it out to other markets.

“We don’t allow these ads on our platforms,” he said. “We have a zero tolerance approach to people using these ads on our platform, but we know that zero tolerance doesn’t mean zero occurrence.”

Sourced from Guardian, Financial Times; additional content by WARC staff