Amazon Questioned Over Coronavirus Price Gouging

Online retailer Amazon is facing questions from a Democratic lawmaker about price gouging related to the coronavirus.

“As the world confronts the prospect of a serious and far-reaching pandemic, corporate America has a responsibility to prevent profiteering on the sales of items such as hand-sanitizer and surgical masks,” Sen. Ed Markey (D-Massachusetts) says in a letter sent Wednesday to Amazon CEO Jeff Bezos. “No one should be allowed to reap a windfall from fear and human suffering.”

He is asking Bezos to answer several questions, including how Amazon determines whether coronavirus-based price gouging is occurring, how many warnings the company has issued to sellers and how many listings it has removed or suspended.

“Internet-based retailers such as have a particular responsibility to guard against price gouging in current circumstances as consumers -- who are finding the shelves of local brick-and-mortar stores bare, and who may wish to avoid venturing into crowded stores and shopping malls -- turn to the internet,” Markey writes.

Markey's letter follows reports of large markups on products in high demand due to the virus. For instance, 48 ounces of Purell hand sanitizer, which typically sells for $10, was being listed on Amazon for $400 this week, according to the Financial Times.

Amazon generally allows third-party sellers who use the company's marketplace platform to set their own prices. But the company also has “fair pricing” policies that prohibit sellers from taking advantage of emergencies like the coronavirus.

“If we see pricing practices on a marketplace offer that harms customer trust, Amazon can remove the Buy Box, remove the offer, suspend the ship option, or, in serious or repeated cases, suspending or terminating selling privileges,” Amazon says in a section of its site outlining the policy.

The company specifically cites setting prices that are “significantly higher than recent prices offered on or off Amazon” as one type of activity that can “harm consumer trust.”

Markey writes that Amazon and marketplace sellers “have a right to expect a reasonable return,” but not to “impose unjustifiably high prices on consumers who are seeking to protect themselves against the coronavirus.”

An Amazon spokesperson said Wednesday the company is “disappointed that bad actors are attempting to artificially raise prices on basic need products during a global health crisis.”

The spokesperson added that the company has recently blocked or removed “tens of thousands” of offers, and is continuing to monitor the site.

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