Why is Google still serving dodgy ads?

There is a 3rd option: malicious stupidity / aka wilful ignorance.

Google is a collection of individuals, so it's very likely both sides of Hanlon's razor are true: a little malice from those in control, persisting a state of stupidity for those executing the process.

As others have pointed out, there will be resistance to improving a process that negatively impacts their bottom line. Incentives, dictate long term behaviour of organisations; whereas Hanlon's razor works better at an individual level IME.

I try blocking the most obvious scams by blocking the announcers but it's basically impossible because the same dodgy ones keep coming back with a new name.

Also hard because they're not always in a language you understand.

I don't think I should do all this work instead of the biggest ad company in the world just to earn 5€ per day, but I'm also not aware of any better alternative.

I’ve never seen that. I report ads on YouTube all the time. I’ve reported ads for illegal drugs, illegal firearms, pornography, and all sorts of various scams. I’ve seen similar advertising to the example in this article, mimicking the phone’s UI. Ive reported them. I’ve never once seen Google reply to any of my reports to confirm what happened. I’ve always wondered, and since I continue to see the ads I just assume my reports go straight into a trash bin.

The illegal firearm ad I saw (more than a year ago, now) I was so shocked that I took screenshots and reported it multiple times. The ad advertised that the weapon was “easy to sneak through security” and “didn’t require an id to purchase” I saw the ad several times across multiple weeks. I reported it every time. I don’t think Google ever did anything about it. If they did, it took them weeks