Senator Ed Markey wants Amazon to open up about its price gouging response
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US Senator Ed Markey (D-MA) is harshly criticizing what he sees as Amazons inconsistent response to ongoing coronavirus-related price gouging on the e-commerce companys third-party Marketplace platform. While Markey is acknowledging that Amazon is indeed removing an ever-increasing number of listings, he said Wednesday in a new letter to CEO Jeff Bezos that Amazons response needs to improve. Hes chiefly concerned about the lack of transparency around how it determines a product is having its prices unfairly raised and the process Amazon undergoes to detect that and then take action.
Last week, Amazon took appropriate first steps in response to this price gouging when it announced it had removed tens of thousands of listings and reiterated that sellers on its platform must comply with its Fair Price Policy, Markey writes. But continued reports of price gouging and a lack of transparency have left customers exposed to unfair trade practices. He cites a Wired report that quoted a seller admitting the enforcement can be haphazard.
Amazon did not immediately respond to a request for comment on Markeys letter.
The price gouging activity was first picked up on last month as COVID-19, the respiratory illness caused by the novel coronavirus, began spreading worldwide. Its hitting popular health and safety products like 3M-produced face masks and sanitization items like Purell hand sanitizer. Neither of those companies are the ones raising the prices. Instead, its third-party resellers who are doing so, and its against Amazons Fair Pricing Policy that specifically warns against price gouging.
Amazon has taken down more than 1 million listings, but price gouging keeps happening
As Wired reported, some items were having their prices increased by three to four times the standard level. Since then, the gouging has become noticeably worse, with 24-packs of 2-ounce hand sanitizer bottles seeing jumps from $10 per box to more than $400. Shipping costs are also being raised to exorbitant levels.
There are numerous state laws against price gouging during times of emergency on essential items like bottled water. And Amazons own policy dictates that you may not drastically increase the price of items well above a recent average or charge excessive shipping fees regardless of what the product is. Yet the company relies on user reports and its own internal detection systems for sussing out the bad actors, and quite often, offending listings slip through the cracks. Thats proving especially true during a health crisis like the coronavirus.
Markey is calling on Amazon, which he says has a particular responsibility to guard against price gouging in current circumstances, to answer certain questions. Those include how it determines price gouging is occurring, at what level an item is considered unfairly priced, how many warnings and removals or suspensions its given out so far, and what resources its devoting to combating the ongoing price gouging problem.
In a statement given to ABC Newsearlier this week, Amazon acknowledged the issue as a growing concern both for the integrity of its platform and for customers who may be running low on options to secure supplies during a time of increased public health concern.
There is no place for price gouging on Amazon, a company spokesperson told the news organization. We are disappointed that bad actors are attempting to artificially raise prices on basic-need products during a global health crisis, and, in line with our longstanding policy, have recently blocked or removed tens of thousands of offers. Amazon said this week its also removed more than 1 million listings over price gouging.
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