@Dave126, the situation you describe would not occur. The more people are allowed to learn from their mistakes the more they won't be fooled the next time. By regulating advertising and protecting the consumer too much, the public aren't allowed to learn. So in effect, the smart people look at the regs, find the loopholes (because regulators are stupid too), and take advantage of them - till the regulators catch up and close that particular loophole. But tech & society changes so much and so fast that regulators are always playing a game of catch up.
It might have been the case in the past with very little communication abilities amongst the population for scammers to take advantage of this lack of communication and go from place to place performing their scam each time. But with social media the public can quickly let everyone know about the scam which limits the ability of the scammers to go from place to place. They're left with a single attempt before they get found out and the public ignores them at worst or actively ostricies them. An ignored scam is a failed scam is a loss making scam.
So yes, people will get hoodwinked, but the point is that they then learn to watch out for themselves rather than use the state as a crutch all the time and not think for themselves either. If people get lazy and just assume that the state is regulating then when advertisers (or any other body) fool them, they will assume it's perfectly OK but the regulators are looking after them - aren't they?
It's plain human psychology. Look at it in the context of teaching a child. Do you watch everything they do like a helicopter parent or do you teach them the rules of life and let them learn from their mistakes. Or in the context of training a person up in a skill. Do you allow them to make mistakes and so learn more about the subject or do you get them to perform by rote the skill which doesn't cater for any variation in the environment or allow enhancements to be found.