Is Contextual Advertising Safe? Analyzing Systemic Risks with Ads on YouTube

Contextual advertising is seeing a resurgence in popularity as a privacy-preserving alternative to behavioral advertising. While often regarded as a coarse-grained approach, advances in AI-driven content analysis have transformed it into a highly granular form of targeting. In this paper, we examine the safety risks of contextual advertising through a two-part empirical study of YouTube. First, we show that advertisers can reach audiences defined by sensitive attributes - such as religion, mental health conditions, and political ideology - by strategically selecting contextual placements, effectively circumventing policies that prohibit such targeting via behavioral signals. Second, to assess how this risk manifests in practice, we develop an automated measurement framework to collect ads delivered on high-risk content environments, focusing on conspiracy videos. We find that contextual advertising is highly prevalent in these environments, disproportionately delivers sensitive ad categories (including alternative health, religion, and political content), and provides limited transparency into why ads are shown. Our results demonstrate that contextual advertising can be as opaque and susceptible to abuse as behavioral targeting, and highlight the need for stronger transparency and regulatory scrutiny of contextual ad systems.