AG Shapiro: Amazon, Facebook, Ebay, Walmart, Craigslist Must Stop Site Price Gouging by Online Sellers

March 25, 2020 | Topic: Consumers

HARRISBURG― Attorney General Josh Shapiro today issued a letter with co-leading Attorneys General Hector Balderas, William Tong, and T.J. Donovan, and 29 of their Attorneys General colleagues, requesting that Amazon, Facebook, Ebay, Walmart, and Craigslist more rigorously monitor price gouging practices by online sellers using their services.

“Ripping off consumers by jacking up prices in the middle of a public emergency is against the law and online resellers like Amazon must join in this fight,” said Attorney General Josh Shapiro in his letter. “These companies form the backbone of online retail and have an obligation to stop illegal price gouging now and put strong practices into place to stop it from happening in the future.”

“Americans are already worried about their health and the health of their loved ones during this pandemic. They shouldn’t also have to worry about being ripped off on the critical supplies they need to get through it,” said Adam Garber, U.S. PIRG Education Fund Consumer Watchdog. “We’re grateful for the leadership of Pennsylvania Attorney General Shapiro and 33 Attorneys General who joined him in calling for more robust protections on these online marketplaces during this crisis.”

The letter lists several examples of price-gouging on these marketplace platforms, all of which took place only in March: on Craigslist, a two-liter bottle of hand sanitizer was being sold for $250; on Facebook Marketplace, an eight-ounce bottle was being sold for $40; and on Ebay, packs of face masks were being sold for $40 and $50.

Attorneys General Shapiro, Balderas, Tong, and Donovan recommend several changes to protect consumers from price gouging:

  • Set policies and enforce restrictions on unconscionable price gouging during emergencies: Online retail platforms should prevent unconscionable price increases from occurring by creating and enforcing strong policies that prevent sellers from deviating in any significant way from the product’s price before an emergency. Such policies should examine historical seller prices, and the price offered by other sellers of the same or similar products, to identify and eliminate price gouging.
  • Trigger price gouging protections prior to an emergency declaration, such as when your systems detect conditions like pending weather events or future possible health risks.
  • Implement a complaint portal for consumers to report potential price gouging.

“Online resellers have built advanced platforms and now it’s time to take that talent and help us beat COVID-19 by ensuring ready access to essential goods at fair prices,” said Attorney General Shapiro. “These are a few potential solutions, and we know each of your companies have the ability to implement other ways to protect American consumers during public emergencies. We look forward to working with you to enforce current statutes on price-gouging and implement these reforms.”

In addition to Pennsylvania Attorney General Shapiro, the letter was co-led with the Offices of Attorneys General from Connecticut, New Mexico, and Vermont, in addition to signatures from the Offices of Attorneys General in California, Colorado, Delaware, District of Columbia, Hawaii, Idaho, Illinois, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oregon, Rhode Island, Utah, Virginia, Washington, Wyoming, and Puerto Rico.

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